Lower My Rate

Lower My Rate

What Affects Home Loan Rates?

There are many factors that affect not only the ability of a customer to qualify for a loan but also the rate they may be offered. Often called the 3 C’s. Credibility, Capability, and collateral are Some important factors include:

Credibility Credit and Payment History
How well you paid you obligations in the past and presently. Late payments can greatly affect both your ability to qualify for a loan and the interest rate offered.

Capability/Debt-to-Income Ratio
Your monthly debt obligations divided by your income provides your debt-to-income ratio. The higher the ratio, the higher the loan’s risk, as the percentage of your income already required to pay existing bills is high. You have less money available to take on new debt or pay for day-to-day expenses and emergencies. Loan programs often include a maximum “DTI” ratio that a borrower cannot exceed.

Collateral/ Loan Amount vs. Property Value
The percentage of the loan amount to your property value (loan amount divided by nhl jersey wholesale the property value) is the loan-to-value ratio. The “LTV” ratio can affect the ability of a borrower to qualify for a loan and the interest rate they receive. Collateral can also be determine by the amount of your down payment.

Other Factors
Among other factors that may affect the rate you are offered are:

•  Property Type (for example, single- or multi-family, detached or condominium/townhouse)
•  Occupancy (whether the property is your primary residence or not)
•  Property Condition
•  Market Conditions
•  Loan Amount
•  Points