Home Buying in Inwood>Question Details

1st-timer, Home Buyer in Boston, MA

What is a competitive interest rate these days? We were just offered 6.7% which seems high to me.

Asked by 1st-timer, Boston, MA Wed Aug 6, 2008

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11
I think the other posters have provided you great advice but I would like to add that the 6th biggest mistake of the Top 10 mistakes people make with their mortgage is figuring “rate” is the most important feature. You could have a great rate but be in the wrong program for your personal circumstances and that can cost you dearly over the long term. My advice is to take the time to sit down face-to-face with a local mortgage planner to disclose all moving parts of your situation and design a mortgage plan that will focus on optimizing your cash flow today while being mindful of your long term retirement goals.
Regards, Dave
3 votes Thank Flag Link Thu Aug 7, 2008
You have gotten some excellent answers there are several factors involved.
1. FICO score
2. are you paying points/fees?
3. Are you talking a 30 year fixed?

Most important is to shop around and do not just rely on the Internet. Check local lenders too!

Your friend in Charlottesville
2 votes Thank Flag Link Thu Aug 7, 2008
I agree with the other posters thus far -- it really does depend on how your loan is structured -- what's your credit score? Are you documenting your income, your assets? What sort of loan program are you looking for? How much of a down payment are you putting? Are you going to owner occupy this home? Are you buying the home or refinancing it? What is your loan amount? Take a look at the link below to find out what exactly affects your interest rate.

To answer your question though and for ballpark purposes, with ideal circumstances (20% down, purchase loan, full documentation, 780+ credit score, $400k loan amount), competitive interest rates as of today would be around:

5/1 ARM @ 5.900%
7/1 ARM @ 6.200%
30 year fixed @ 6.400%

Hope this helps! Best of luck.
2 votes Thank Flag Link Thu Aug 7, 2008
Many factors need to be considered as all have mentioned. Even the state youre looking to purchase in can determine difference in rates. Make sure you work with a mortgage consultant in the city youre looking to purchase. For example, if youre looking to purchase a new construction hi-rise condo in NY then you probably shouldnt be using a loan officer from Vermont (no offense to Vermont, I love Ben and Jerrys and syrup). sunny_hong@countrywide.com
1 vote Thank Flag Link Thu Aug 7, 2008
Interest rates also differ for level of income, assets, loan to value ratio and region in which you are buying. Regional banks that offer portfolio products have the ability to discount their rates from the larger national access lenders.
Web Reference: http://www.guardhill.com
1 vote Thank Flag Link Thu Aug 7, 2008
Interest Rates are different for buyers depending on their Fico scores (credit scores) Buyers with better scores get better rates.
1 vote Thank Flag Link Wed Aug 6, 2008
For an "A" rated borrower (FICO above 740 generally), I saw 4.38% wholesale rates for conforming 30-yr par loans (i.e., no points and 20% down and 60 day rate lock) last week in NYC metro. The retail mark up has been about 0.50% to the rate (i.e., 4.88%). The cost of a 90 day rate lock was about 0.5 pts extra upfront. If FICO was above 700 but below 740, it would have cost an extra 0.25% in wholesale rate above that for "A". If you were pushing 620 FICO, then the additional wholesale rate would have been 0.75% above that for "A".

Keep in mind that mortgage brokers do not work in your best interest (and neither do loan officers). They often try to get you to take a higher rate because the lender will pay points to "you" for taking a higher rate (called a rebate). Often times, the broker/officer does not share those rebates with you and instead pockets them himself. The rebates are often times capped at 3% of the mortgage ($12K on a $400K mortgage!!!). That's in addition to any points he may be charging you upfront for his services.

If you are working with a broker, ask him to share with you his wholesale price sheet. If he won't, he's likely trying to rip you off. As middleman, he should make some money on the transaction but he shouldn't be afraid to show you how much!
0 votes Thank Flag Link Wed Jul 21, 2010
That's a great question may I referr you to Patricia Lavigen of Manhattan Mortgage. You can reach her at plavigne@manhattanmortgage.com, or call her at 854-234-5472.


Tony Lara
Licensed Real Estate Salesperson
Charles Rutenberg Realty
0 votes Thank Flag Link Wed Jul 21, 2010
intrest rates are low 4.7 for 15yr self liquidating.are available.It also depends on your credit rating
0 votes Thank Flag Link Mon Mar 2, 2009
The rate you are offered depends on your FICA score, income, debt-ratio, where the property is located and other factors. Today 6.5-7% is pretty much the norm on a 30 year fixed...lenders are nervous due to all of the sub-prime mess. The best advice is to get a good mortgage broker who keeps abreast of the rapidly changing rates/programs and can get you the best deal. Banks generally are not looking out for your best interest...they are looking to maximize profits. Generally, the fee you pay a mortgage broker is nothing compared to the savings they can obain for you in interest, points, etc.
Web Reference: http://www.elliman.com/gjm
0 votes Thank Flag Link Sun Aug 17, 2008
I agree with the others, great answers. Keep in mind, in 1950, the average mortgage interest rate was 4.25% (lowest in US history that I know of). In 1981 the interest rate had climbed to 17.5% so in comparison 6.x% is not bad.
0 votes Thank Flag Link Thu Aug 7, 2008
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