Fort Collins Home Mortgage Rates

Have you ever wondered what decides the ultimate rate and why interest rates are what they are? Why do different borrowers receive various interest rates? or why do rates fluctuate?

Several variables are used to compute interest rates nowadays.

The demand from investors for a specific form of mortgage is the first criteria used to determine the interest rate. The competition from other investment products will determine this. Simply simply, interest rates decrease as demand for mortgage securities increases.

The actual property used to secure the mortgage makes up the second factor in determining interest rates. When assessing the risk of a mortgage loan, the type of property—single family, duplex, or multifamily—as well as its planned use—primary, secondary, or investment—are both taken into account. As an illustration, a mortgage loan for a multi-family investment property has a larger risk than one for a primary dwelling for a single family.

The loan to value of the subject property is the third element. A lower down payment entails a higher loan to value ratio, which increases risk and increases the likelihood of default.

The borrower’s creditworthiness is the last deciding element. Debtors with higher credit scores and lower debt-to-income ratios—which measure monthly payments as a percentage of gross monthly income—are viewed as posing a smaller risk than those with lower credit scores and larger debt-to-income ratios.

Even though each component alone does not affect the mortgage interest rate, they all work together to change the risk assessment for the final interest rate that is provided to the customer.

Contact one of our qualified mortgage professionals for a customized rate quotation for more details on the current Fort Collins Colorado mortgage rates. Average National Rate according to Freddie Mac.