October 3, 2019
There is still time to take full advantage of the higher 2019 FHA home loan guaranty limits set at the start of the new year. If you are thinking about a mortgage or a refinance loan, 2019 may be the year for you.
Recent headlines combining a trend in rising home values, more borrowing power, and changes to certain aspects of the home loan industry making it easier in certain sectors (including condo project sales) to buy and sell real estate for residential purposes.
Add to that interest rates that are lower after two weeks of improvements at the time of this writing and you have the perfect circumstance for some borrowers interested in lower rates and more borrowing power.
What do you need to know about the current FHA home loan interest rate trend?
At the time of this writing, the best-execution rate offered to the most well-qualified borrowers is approximately 3.375%, and rates are described by some market watchers as the best since circa 2011.
But home loan interest rates are subject to change, and those low rates you see mentioned above are not available to all borrowers. Your FICO scores and credit history affect your mortgage loan rates. So do market forces that have lenders adjusting the best-execution rate on a daily bases.
And on top of that, unless you have an interest rate lock agreement with your lender (which happens at the point in the home buying process where you have committed to a single piece of real estate and are moving forward with the purchase) the rates will still fluctuate.
That means you have to get to the part in the home buying process where you are about to enter into a rate lock commitment with the lender (that’s definitely NOT a planning stage activity, more of a “move toward a closing date” stage of things).
Only with the rate lock will you know exactly what your mortgage rate is and how long it is guaranteed before closing day.
FHA home loan interest rates are lower than they have been in years past. But until you get to the rate lock commitment, those rates are subject to change. Markets can be volatile, especially in the current mortgage rate environment.
These lower rates apply to both purchase loans and refinance loans. That means you can refinance an existing FHA mortgage or a non-FHA home loan for a primary residence you intend to live in as your home address.
It may be a good idea to get in touch with a participating FHA lender to see what advice she may have on rates, timing of a rate lock commitment, and how to get ready for the loan application process.
Bruce Reichstein has spent over three decades as an experienced FHA and VA home loan mortgage banker and underwriter where he was responsible for funding “Billions” in government backed mortgage loans. He is the Managing Editor for FHANewsblog.com where he educates homeowners on the specific guidelines for obtaining FHA guaranteed home loans.
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