Here are the main factors outside your personal finances that can affect your mortgage rate.

 


Here are the main factors outside  your personal finances that can affect your mortgage rate. 

 1st Tournament 

 Simple supply and demand affect mortgage rates. “If you have a lot of lenders in an area, that leads to a bidding war,” says Sykes. Therefore, buying or owning a home that is not in short supply of lenders is in your favor. 

 The surge of online lenders helps you find and compare transactions wherever you live, but the presence of a physical office makes a difference. “Last year's analysis showed that the concentration of local banks also played a role,” says McLaughlin. "There was a fairly strong correlation between the number of physical banks in the per capita market  and mortgage spreads. In markets with high per capita banks, spreads are low, interest rates are low, and others. Everything was equal. "

2. Loan balance 

 The amount of your mortgage is important, so home prices in your area can affect your interest rates. "The elephant in the room is the balance of the loan. Setting up a million dollar mortgage costs the same as setting up a $ 100,000 mortgage, but a million dollar mortgage is the lender. Will make more money for you, "says McLaughlin. On average, mortgages from about $ 350,000 to $ 500,000 have a mortgage rate about 0.23% lower than loans with a balance of $ 100,000 or less, according to the same house study. The difference in interest between  loan balances is "... cheaper mortgages don't make them that much, so lenders are trying to recoup their origination costs," says McLaughlin. 

3 Cost to do business 

 If lenders have lower fixed costs,  they may be able to offer lower mortgage rates. "Everything that pushes up all prices ... probably also affects mortgage rates," Sykes said. Therefore, if a bank pays a small amount to maintain lighting, it should be taken into account. “The more foreclosures  in the area, the more dangerous it is for lenders to lend money,” says Sykes. Also, the time it takes for the foreclosure process depends heavily on the state laws that the payer may consider. “States like Connecticut and Florida, where legal proceedings can take years, need to be actually considered by lenders,” she says.

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