What are mortgage rates?
Mortgage rates are the interest rates that borrowers must pay on a mortgage loan. They are determined by the lender and can vary depending on a number of factors, including the type of loan, the creditworthiness of the borrower, and overall market conditions.
There are different types of mortgage rates:
- Fixed-rate mortgages: These mortgages have an interest rate that remains the same for the entire term of the loan, usually 10, 15, 20 or 30 years. This means that the monthly payments will stay the same throughout the life of the loan, making it easier to budget.
- Adjustable-rate mortgages (ARMs): These mortgages have an interest rate that can change over time, usually every year or every few years. The interest rate is tied to an index, such as the U.S. Treasury bill rate, and can increase or decrease based on the index. This means that the monthly payments can change over time, which can make it more difficult to budget.
- Hybrid ARMs: These mortgages have a fixed rate for a certain period of time and then adjust to an adjustable rate. A common example is 5/1 ARM, where the rate is fixed for the first 5 years and then adjust every year.
Mortgage rates can vary depending on the lender, the type of loan, the creditworthiness of the borrower, and overall market conditions. It's important to shop around and compare rates from multiple lenders to find the best mortgage rate for your specific situation. Also, it's important to keep in mind that low mortgage rates can be misleading, and it's important to consider the overall costs and terms of the loan before making a decision.
Check out CapCenter's current mortgage rates and click the desired rate for details to look at associated fees, monthly payment calculations, cash-to-close, typical industry fees, and CapCenter savings.