HERE’S WHAT GOES INTO YOUR HOME LOAN RATE QUOTE!
Sr. Loan Officer
Chris Carter
Published on May 31, 2022

HERE’S WHAT GOES INTO YOUR HOME LOAN RATE QUOTE!

You want to borrow a large sum of money to buy a home, and while the home acts as the lender’s collateral, giving them a safety net in case of loss (missed payments etc.), there are still several factors that go into a rate quote. Of course there are many economic factors which sway rates over time. We’ll cover those in another article.

Verify my mortgage eligibility (Aug 8th, 2022)

Here are some of the most common LLPA’s:

Credit History
Consumers with higher credit scores will get better loan pricing than consumers with lower credit scores. Lenders look at the lowest of the borrower’s mid-FICO scores to determine how the rate is priced.

Loan Size
The bigger the loan, the more revenue a lender can make, which equates to better loan pricing.

Verify my mortgage eligibility (Aug 8th, 2022)

Loan-to-Value (LTV)
Typically, the higher the down payment, the better the loan pricing.

Loan Type
Adjustable mortgage typically come with better loan pricing but may have higher up-front costs. Also, shorter term loans, like 15-year fixed will have better loan pricing than a
30-year fixed.

Property Type
A single-family residence will typically have better loan pricing than a condo.

Verify my mortgage eligibility (Aug 8th, 2022)

Debt-To-Income Ratio
Debt-to-income ratio (DTI) measures total credit debt (including proposed mortgage PITI) divided by total gross income (before taxes). The lower the DTI, the better loan pricing.

Closing Date
a 30-day lock is the industry standard. If you want a shorter lock period, the pricing may be slightly better, while a longer lock period may be slightly worse loan pricing.

Occupancy Type
Typically, rental or investment properties have higher interest rates than a primary residence or even a second home.

Verify my mortgage eligibility (Aug 8th, 2022)

Cash-Out Refinance
A cash out refinance will have higher pricing adjustments than a rate reduction refinance, or even a purchase loan.

Combined Loan-to-Value (CLTV)
This ratio includes not only the current loan you are wanting, but any additional loans on the property, such as a home equity line.

Show me today's rate (Aug 8th, 2022)
Sr. Loan Officer
Chris Carter Sr. Loan Officer
Click to Call or Text:
(916) 794-8042