Best Mortgage Rates In Arizona – It’s more than a month into the New Year and Arizona mortgage rates are still at or near historic lows. Average mortgage rates in Arizona fell below 3% for the first time in July 2020 and remain at or below 3% for a 30-year fixed rate mortgage. Interest rates on 15-year mortgage terms are similar or even lower in some cases. It’s impossible to know for sure how long these low mortgage rates will last, but when they do come back, we may never see rates like this again.
The interest rate you pay on a home loan or refinance in Arizona depends on many different factors, some of which are within your control and some of which are beyond your control. These factors can be divided into three general categories:
Best Mortgage Rates In Arizona
You have a lot of influence over the amount of mortgage you get. More specifically, your mortgage rate depends largely on how well qualified lenders think you are. The better your qualification, the less risk you think.
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When rates first fell below 3% last summer, our country was still in the early days of the deadly COVID-19 pandemic. To this day, we are still dealing with the consequences of the outbreak, but we may be turning the corner as the vaccine is widely distributed among our population. Why is this important? Because current home loan rates in Arizona are still at or near historic lows, due in large part to this fact and the disruption it has caused to nearly every sector of our society.
More generally, it’s important to remember that government policy, as well as the overall state of the economy, can have a significant impact on mortgage interest rates. When the COVID-19 pandemic hit, the Federal Reserve began buying an unprecedented amount of mortgage-backed securities (more than $1 trillion so far). With so much money being pumped into the market, this is one of the main factors driving down yields and keeping interest rates low.
The question is – how long will they continue to do so? Although the Federal Reserve has hinted at keeping interest rates low until 2021, no one can give a definitive answer to this question. One thing we know for sure is that this level of buying will not continue forever. At some point the Fed will relax, perhaps when they are convinced that the economy is back on its feet and/or they are concerned about excess liquidity and the risk of inflation.
Arizona Bah (basic Allowance For Housing) Rates
It is also important to note that we have a new administration in the White House from a different political party. This means there is a good chance of major policy changes, some of which could affect mortgage interest rates.
You may be surprised to learn that Arizona home loan rates and Arizona refinance rates can vary widely depending on the lender you go through. Some lenders specialize in a certain type of borrower, but the main reason for the different rates is that many lenders include points and fees. In exchange for a lower interest rate, you end up paying higher fees (ie points). That’s why it’s a good idea to shop around when looking for the best home loan rates in Arizona and make sure you know how to choose the best mortgage lender.
A 2016 study of potential home buyers by the Consumer Protection Bureau found that 30% of borrowers did not compare before getting a home loan and 75% said they only applied for a home loan through one lender. The Bureau further reports that failure to find the best mortgage rates costs the average borrower about $300 a year, which can add up to thousands of dollars over the life of the loan. We’ve created a guide to help you easily compare your loan estimates.
Mortgage Interest Rates
The aforementioned study shows that it pays to shop around and compare mortgage rates from multiple sources, and it pays to work with a local mortgage broker like AZ Lending Experts who can shop for you. At AZ Lending Experts, we have access to dozens of the most competitive lenders and can secure our clients the best loan programs available in the state. Whether you’re in Phoenix, Mesa, Gilbert, Queen Creek, Avondale, or Tempe, where our office is located, we can get you the best mortgage rates you can qualify for.
You may be wondering why it’s such a big deal that interest rates are still hovering below 3% and why you should take advantage of this while those rates are still available. One or two percentage points isn’t that much, is it?
That may not sound like much, but consider the difference in your monthly payment on a $300,000 home in Phoenix if mortgage rates averaged 2.63% today versus 4.54%, which was the average rate in 2018. Important note: interest rates change every day, so the 2.63% number is just an estimate and the rate could be higher or lower on any given day. The idea is to get a good idea of the difference in the cost of your loan by taking out a home loan today compared to a few years ago.
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In this example, a $300,000 fixed rate mortgage due in 2021 at 2.63% (2.814% APR with closing costs) would result in a mortgage payment (principal and interest) of $1,206. The same loan amount in 2018 with an interest rate of 4.54% (4.726% APR with closing costs) would give you a mortgage payment of $1,527. As you can see, just a jump of about 2% in mortgage rates would cost you $321 more per month to buy a $300,000 home. That’s $3,852 per year or a whopping $115,560 over the life of the loan! You can see more comparisons here.
If you’re thinking about buying a home in Tempe, Mesa or anywhere in the Phoenix area, there’s no better time than now to lock in the best mortgage rates. At AZ Lending Experts, we’ve helped countless clients get into their ideal home at the lowest rates and fees available, and we can do the same for you. Simply contact us for a free consultation with one of our mortgage advisors. We are looking forward to you!
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Just a day after soaring to a 23-year record high, 30-year mortgage rates fell nearly three-tenths of a point on Friday, posting their biggest daily drop since early March. Averages for all credit types edged lower on Friday, with most down double-digit basis points.
The most recent average 30-year fixed rate is 7.81%. As interest rates vary widely between lenders, it is always wise to shop around for the best home loan option and compare rates regularly, regardless of the type of loan you are purchasing.
National averages of the lowest interest rates offered by over 200 of the nation’s leading lenders, with a loan-to-value (LTV) ratio of 80%, an applicant with a FICO credit score of 700-760 and no mortgage points.
Va Loan Rates Today
Interest rates on 30-year new mortgages fell dramatically by 29 basis points on Friday to average 7.81% after jumping to 8% the previous day. The decline was the largest one-day decline since March 10, and was also the largest decline of the day across all loan types.
Other dramatic changes were the 30-year FHA average, which lost 23 basis points, and the 20-year average, which added 27 basis points.
Freddie Mac released its latest weekly mortgage average on Thursday, revealing 30-year rates hit a 23-year high. Freddie Mac’s average is currently 7.31%, up eight basis points from August’s all-time high of 7.23%.
Home Plus Arizona
Average combined interest rates from the previous five days and may include loans with discount points. On the contrary, they show his averages
Interest rates on 15-year loans also eased on Friday, but fell 11 basis points to 7.22%. The year-to-date average of 7.33% was the highest level for 15-year rates since 2001.
Jumbo 30-year yields similarly fell 12 basis points to 7.15% on Friday. Although daily jumbo averages are not available prior to 2009, it is estimated that the recent peak of 7.27% was the most expensive level for jumbo 30-year loans in at least 20 years.
Current Va Mortgage Rates
The only new market averages that fell by single digits on Friday were 5/6 ARM loans, which fell an average of 8 basis points, and the 7/6 ARM average, which fell just 4 points.
For the most part, refinance rates were similarly lower on Friday, although the average for 5/6 ARM refi loans added 11 basis points. The average 30-year refi fell 29 basis points, as did its new market sibling, with the spread between 30-year refi rates and new market rates remaining at 36 basis points. Average refi 15 years
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