As a consumer, it’s important to understand that mortgage rates change with the movement in the bond market, specifically the value of mortgage-backed securities. These changes happen daily and sometimes multiple times a day. Rates will vary from program to program. For example, rates on USDA loans are a bit higher than FHA loans because USDA allows for 100% financing.
Since rates are so volatile it’s also important to understand the difference between a rate quote and a rate lock: A rate quote is not guaranteed until it’s locked. The rate lock is tied to the property address so it’s important to have your contract in hand when requesting a rate lock. Once the rate is locked you typically have 30-45 days to close your loan.
Why can’t a lender simply quote a rate? There are many factors that determine how a mortgage loan is priced. The loan program, term of the loan, and the amount being borrowed determine the “base” rate. From there an applicant’s credit score, income, down payment, etc are evaluated to determine the strength of the loan. No two loans are alike which is why it’s important to be complete with your application and be sure your lender has all of their questions answered to the best of your ability.
To submit an application or for more informaiton please contact Leesa Sandoval
972-407-7922 or 214-202-0491
