In an ever changing interest rate environment, it is important to understand what goes into determining what your interest rate will be. The following are a few of the factors that make up the interest rate that is specific to your mortgage loan:
- Loan Amount
- Overall Loan-to Value of Property
- Credit Rating
- The Reserve Requirements
- Debt-to-Income Ratio
There are also external and market factors that go into determining your mortgage loan rate. The following are a few examples:
- The relative strength/weakness of the Mortgage Backed Securities markets.
- The relative strength/weakness of the yield(s) and price(s) associated with the government bond offerings in the market place.
- The current appetite and availability of government, as well as portfolio lenders to lend money that is securitized by physical Real Estate properties.
Another major factor that will determine your interest rate will be the type of loan that you choose to meet your timeline and needs, and the occupancy status of the property. Choose from a 3, 5, 7, and 10-Year ARM (Adjustable Rate Mortgage) loans (including interest only) that is typically amortized over 30 or 40 years. Along with 10, 15, 20, 25, and 30-Year Fixed mortgage loans.