Mark Ikeda

Mortgage Consultant

  • Home
  • About
    • About Us
    • Privacy Policy
  • Blog
  • Resources
    • First Time Home Buyer Tips
    • First Time Home Seller Tips
    • Closing Costs
    • Home Appraisal
    • Home Inspection
    • Loan Checklist
    • Loan Process
    • Loan Programs
    • Mortgage FAQ
    • Mortgage Glossary
  • Apply Now
  • Read or Write a Review
  • Contact

How Are Mortgage Rates Determined?

December 3, 2019 by Mark Ikeda

How Are Mortgage Rates DeterminedWhen someone is interested in buying a home, there are a number of factors that people need to consider. Some of these include the budget, the size of the home, and the mortgage interest rates. 

The mortgage rate is going to play a tremendous role in whether or not someone is going to be able to afford their dream home. For this reason, it is critical for everyone to know how a mortgage rate is determined. There are a number of factors in someone’s financial history that are going to impact the mortgage rate the lender offers.

The Credit Score

One of the most important factors that a lender is going to consider is someone’s credit score. A credit score is a reflection of someone’s risk to the lender. The higher the credit score, the more likely the loan is going to be repaid, in the eyes of the lender.

If someone’s credit score is too low, the lender might not make an offer at all. In order to reduce the interest on someone’s mortgage, it is important to correct any inaccuracies on the credit report ahead of time. This will make someone more competitive when applying for a mortgage.

The Employment History

The lender’s biggest concern is making sure their loan is repaid. In order to make mortgage payments on time, the borrower needs to have a steady stream of money coming in. This means maintaining a steady job.

In order to predict this, the lender is going to look at someone’s employment history. The longer someone has been employed, and the fewer gaps someone has in their employment history, the lower the interest rate on the mortgage is going to be. 

The Current Financial Market

Some of the factors involved in a mortgage rate are outside of the borrower’s control. Mortgage rates are also impacted by the current financial market. Like the stock market itself, the mortgage rates are going to rise and fall with the real estate market. It is important for everyone to think about the current financial market when applying for a mortgage.

Thinking About Mortgage Rates

These factors will play a role in the mortgage rate someone is going to be offered. Everyone should think about the interest rate on a mortgage when looking for a home. 

Talk about your personal financial situation with your trusted home finance professional. They are a valuable and experienced resource that can answer all of your questions regarding the best fit for your mortgage.

Spread the Love!

Filed Under: Mortgage Tagged With: Market Conditions, Mortgage, Mortgage Rates

Mark Ikeda

Contact Mark


Mortgage Consultant
VIP Mortgage
CALL (602) 793-1098

Licenses:
National ‑ 213096
State ‑ AZ: LO‑0913899
CA: DBO213096
GET A RATE QUOTE  

Connect with Me!

How can I help?

  • This field is for validation purposes and should be left unchanged.

Browse Articles by Category

The Latest Articles

  • Can I Qualify for a Mortgage After Declaring Bankruptcy? Yes — and Here’s How
  • A Home Loan For an AirBnB Property: What To Know
  • 3 Closing Costs That Most Buyers Forget to Factor in and What You Can Expect to Pay
  • What’s Ahead For Mortgage Rates This Week – June 21, 2022
nmlsconsumeraccess.org
AZ LO-0913899 Equal Housing Lender VIP Mortgage, Inc. does business in accordance with Federal Fair Lending Laws. VIP Mortgage NMLS #: 145502 VIP Mortgage BK #: 090974
Equal Housing Lender

Our Location

9221 East Vía de Ventura
Scottsdale, AZ 85258

Copyright © 2022 · Powered by MySMARTblog