INTEREST RATES AND YOUR BUYING POWER
With today’s current low-interest rates, your buying power has in some cases doubled or tripled. This means what was once out of your reach is now within reach. An exciting time for consumer, lender, and realtor.
Let’s take a look at a few rates of the bigger banks around the country. As of 6-6-21.
- 30 year fixed 2.875%
- 20 year fixed 2.750%
- 15 year fixed 2.125%
- 30 year fixed 3.125%
- 20 year fixed 2.875%
- 15 year fixed 2.250%
- 10 year fixed 1.990%
Just looking at the above rates makes it clear that lending from a “big” bank doesn’t always mean you get the best/low rate. Be sure to check in with your local bank for their interest rates. You’ll be glad you did.
United Country Midwest Lifestyles Properties encourages you to shop at your local bank for great low-interest mortgage rates also. Shopping with your local bank has many advantages. First, you can get pre-approval. Pre-approval tells your realtor and your buyer you are serious about buying and have the means to do so. By getting pre-approval you save yourself time by looking with your realtor at houses you can afford.
LOCAL, LOYAL, LOGICAL
Secondly, working with your local bank, you have the ability to stop in and talk face to face with your banker. Most local banks also have the option to do your loan banking online for people who are unable to be physically in the bank during lobby hours. Your local lender is accountable to the applicant and local realtors involved in the transaction.
Thirdly, a relationship with a local bank is viewed favorably by realtors; since they are local themselves making communication easier and reliable. Any issues that arise can easily be handled by professionals that deal with each other often. Being local means efficiency, and consistency throughout your mortgage transaction.
Closing your mortgage with your lender, realtor, and title insurance company all under the same roof gives you instant satisfaction and peace of mind; everything is above board and no surprise fees.
REMOTE AND OUT OF TOUCH
Remote mortgage companies don’t have a relationship with you. They won’t see you on Main Street, at the local football game, support your local fire and ems, as well as backing your kid’s local athletic team, or attend your place of worship.
YOUR FINANCIAL NEEDS COME FIRST
A great interest rate offer is tailored to your financial needs. For one person a long term fixed rate may be best, yet another may need only a variable rate. It all depends on your financial needs, ability to pay and timing of that source.
Here is a list of things to watch out for in mortgage loans:
- Be sure to identify who will be servicing your loan. This is invaluable for working with making payments should an unforeseen life event happen, as well as the ease of resolving any insurance claims due to a fire or natural disaster. Example: Many people do not realize if they have a claim on their insurance, the lien holder (your bank) will need to sign off on any proceeds from the insurance claim. This can be especially frustrating when your lienholder is a mortgage company that is unknown to you.
- Keep in mind it is NOT UNCOMMON for your mortgage loan to be sold during the loan lifetime. Know who you are making the payments to. In my visit to a local lender, he shared with me a story of a couple who originated their mortgage with a distant mortgage company and after closing on the loan, the loan was sold several times within the first few months. Creating confusing for the couple, on where to even send the payment. This put them on the “past due” list. They spent a lot of time looking where to send their payment.
- Payments should be tailored to your income. “Act your wage.” While lower interest rates today increase your buying capacity provided the interest rate is fixed; but if you get into a variable rate and it increases, you are stuck with the mortgage at a higher payment.
- Be aware of closing costs and fees.
THE INFORMED CONSUMER
As always, being an informed consumer is of great advantage when checking into mortgage rates. Bigger isn’t always better. Local lending offers many advantages for yourself as well as your community. We at UC Midwest Lifestyles and Properties look forward to working with you, your local bank and Title Company.
