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December 22, 2015

Tips, Bits & Lists: Day 7

Homeownership
HomeSteps

On the 7th day of tips, bits & lists, we discuss the 7 factors that go into your mortgage rate. The good news for homebuyers is that we expect mortgage interest rates to continue to hold below 4% through the end of the year. Our weekly survey of lenders showed that the average rate for a 30-year fixed-rate mortgage was 3.97% with an average of 0.6 point for the week ending December 17, 2015. The 15-year fixed-rate mortgage averaged 3.22% with an average of 0.5 point.

But those are just the averages. Understanding what factors go into determining your rate can make you a savvier shopper. According to the Consumer Financial Protection Bureau, 7 key factors affect your interest rate:

  1. Credit score

  2. Home location

  3. Home price and loan amount

  4. Down payment

  5. Loan term

  6. Interest rate type

  7. Loan type

Armed with this information you can have confident conversations with lenders and make sure you get a good deal. Visit My Home by Freddie MacSM to learn more about your down payment options, ways to improve your credit score and how to choose the mortgage that's right for you.

Read other posts in this series and stay tuned for the next 5 days of tips, bits & lists.

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