Best Mortgage Rates in Washington

Joseph Meyer
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Mortgage Rates in Washington

Washington is home to some of the best interest rates in the nation for mortgages. Rates can vary based on one’s credit score and other factors, but the average interest rate for a 30-year fixed interest rate loan is around 3.65% as of early 2017. This makes Washington State both affordable, for home buyers, and profitable, for mortgage professionals.

If you want to see what current rates are, check out the Find A Rate tool at the top of the page. For mortgage professionals the process is simple – select the desired state, click loan type, and put in the desired loan amount. For buyers, you may want to call local lenders and get a few quotes, but this resource can give you a pretty good idea of what to expect in the state.

Mortgage Rate Factors in Washington

What is a good mortgage rate today? At the time of writing, it used to be 4.5 percent, but fluctuates between 3.25 percent and 6 percent. Why is it so volatile? It’s simple. The price is determined by the market. First of all, whether you like it or not you will pay a certain rate every month, so you should look for the best deals available to you.

You usually need to have perfect credit to get the lowest interest rates. This is very important to check. Because of all the turbulence in the market until now, sometimes even your credit isn’t good enough to get that super low rate you might be hoping for. In order to get the best rates for your mortgage, you have to do your research. You should first look at the sales that are going on. Maybe your rate is better than what you are seeing advertised in your area.

You should first look at the mortgage refinancing options that are available to you. Your savings can be great. You may be able to get a lower rate with a lower monthly payment. Or even cut your interest rate in half, which can be significant if you stay in your home long enough to make that extra money back in interest savings.

Credit Score and History

Your credit score often represents your ability to manage debt, money, and possessions in a way that people can trust. Lenders use your credit score to evaluate your ability to make the payments required by your loan application. They look at factors such as whether you pay your bills on time, and how much of your available credit you have used up.

A good credit score often represents that you are financially responsible. Lenders will also look at your history. This includes looking at how you have handled things like car loans, rent payments, paychecks, and credit cards. In some cases, they may look at any default judgments you may have had in the past.

The lender will be looking at your credit score and history to determine your ability to repay a loan. They are also looking at how these types of situations may impact their ability to collect on the debt if you can’t make your payments.

Loan Type and Term

There are many factors that come into play when you are trying to figure out the best mortgage rate, especially in the current economic climate. The best rates available can be obtained by waiting until the economy improves or by taking steps to improve your profile in the lender’s eyes.

Sure, everyone wants a low interest rate, but there are other factors which go into the loan process. Even though a lower interest rates will cut down on monthly payments, it is not the sole factor in determining how much you can borrow. The amount you can borrow depends on the property’s loan to value ratio, how much you are willing to pay upfront, your credit scores, credit history, and other factors.

The following three tables list loan term lengths and interest rates for each product. We can see that with each increase of five years, the interest rate also increases.

Type of Interest Rate

Before mortgage rates, were there fixed mortgage rates?

Fixed-rate mortgage rates referred to a loan where the interest rate stayed the same throughout the term of the mortgage. If a borrower’s total monthly payments were 840.00 over a 15 year term on a fixed rate mortgage of 8.00% interest, the monthly mortgage payment would be 840.00.

Interest rates were typically fixed by adoption of a rate set by the government, inflation or investors' expectations. The interest rate, loan amount, term and income of the borrower were all wrapped into one fixed-rate mortgage.

When mortgage rates were fixed, a borrower could escape fluctuating rates by knowing the interest payments would remain the same. This gave homebuyers confidence as they could budget and plan how much they would be spending each month for their home.

However, fixed-rate mortgage rates caused certain risks such as if interest rates rose, the borrower would have to pay more interest over the loan term. If rates fell, the borrower would be getting a lower rate than what the market offered and might have an opportunity to get a lower mortgage rate with their bank.

Fixed-rate mortgages are on the decline. Today, the majority of fixed-rate mortgage loans are hybrids of some sort.

Type of Refinance

Refinancing is usually confusing because many people aren’t sure what to consider when choosing which type of refinance mortgage.

Here are the 3 types of refinance loans.

Rate and Term: This is your typical refinance loan. Almost 90% of people who refinance are refinancing in this way. You don’t have to be looking for a lower rate to choose to refinance in this way. You are merely changing the terms of the loan. The fees associated with this type of loan are the lowest. The main benefit of Rate and Term refinancing is that your monthly payment remains the same for the life of the loan.

Interest Only: This is obviously a loan for those who want to save a ton of money on the mortgage over the life of their loan. This type of refinance costs the most. The lesson here is that committing to this type of loan means you are also committing to paying more for a longer period of time. You should only choose this type of loan if you are planning to sell the home in 5 to 8 years at the most.

How to Get the Best Mortgage Rates in Washington

Asking and searching for how to get the best mortgage rates in Washington is a common everyday question. When you are looking for cheap loans in Washington you will want to shop around. Asking about the top mortgage companies and top mortgage brokers is an easy way to do this.

The interest rates, fees, and details on a loan are established between you and the lender whose mortgage products and services meet your loan requirements.

The key to getting a lower rate is the ability to shop around, compare, and apply with multiple lenders. More than 80% of consumers use mortgage lenders that aren’t their first or even their second choice. Compare the mortgages and rates from mortgage brokers in Washington and find a loan source that meets your financial needs.

Determine Your Eligibility

The process of obtaining a mortgage loan is not very different from the process of applying for a job. There are preliminary screenings where basic requirements must be met, a selection and application process, and intensive interviews with a review board. It is this application that will determine if you qualify for a loan. There is a certain set of requirements that each applicant must meet in order to be approved for a mortgage loan. This is called the underwriting process. You can get pre-qualified for a mortgage loan before you start your application. Pre qualification is the first step in the mortgage approval process.

Pre-qualification for a mortgage loan is almost like applying for a job. You list all of your assets and liabilities, your income and expenses, and anything else that could affect your ability to repay your loan. All of this information is reviewed, and a lender will then determine if you are eligible for a mortgage loan. Another part of the pre-qualification process provides you the opportunity to preview rates and terms, and to get an estimate of the money needed to make the required down payment on the property. You can also determine how long it would take to pay off your new home.

Compare your Loan Options

There is no doubt that mortgage rates are at their highest point in years.

If you’re in the market for a new home, then the time is now…because rates won’t stay that low forever. But if you’re not in a rush to buy or sell, you may consider waiting a few months to see how the market develops.

These days, there are more choices than ever for home loans. You can choose from conventional, FHA, or VA loans. You can apply for a fixed-rate mortgage, adjustable, or hybrid mortgage. You may have the option to convert to a 15 or 30-year fixed rate as the interest rates rise.

There are more ways to finance your home purchase than ever before. When you’re in the market for a home loan, you need to explore your options to make sure that you’re getting the best deal possible.

Just as there are many types of homes on the market, there are many loan options. To get the most out of your financing, it’s best to compare the available options before you make a final decision.

Negotiate with Multiple Lenders