mortgage rate lock
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Mortgage Rate Lock: When to Lock In a Rate

Mortgage Rate Lock: When to Lock In a Rate. Buying a home can be a stressful process, especially when it’s your first time. When you’re looking for a mortgage to help pay for your home, there are many things to consider. Mortgage rates are constantly shifting, and you need to keep an eye on them to ensure you get the best rate.

When you want to ensure that you’re getting the best rate, you have to lock in a rate before it’s too late. Here is what you should know about mortgage rate locks:

What’s A Mortgage Rate Lock?

A mortgage rate lock is when a lender offers to guarantee the interest rate on your home mortgage for a fixed period. While the lender may ask for a fee for doing so, it can vary depending on the lender you are working with.

The lock period generally starts from the time you begin the process for the loan all the way to the time you end up closing on the loan. Once your interest rate is fixed, it won’t be changed unless you end up changing crucial details on your application form.

When Is The Best Time to Lock In A Rate?

If you’ve already begun the process of looking around for good lenders in South Florida, you might already be at the stage to lock in a lender. When you’ve compared a few mortgage interest rates, contact the lender who offers you the best conditions and interest rates.

Once approved for a home loan, you can lock in a rate with your desired lender. While you can wait and see if the mortgage rate goes down, this can be both a waste of time and money. The rates fluctuate, and trying to predict them can take more effort than it’s worth without conclusive results.

Does It Cost To Get A Rate Lock?

Depending on your lender, you might be charged for a rate lock, or it can be free. Ensure that you ask beforehand so you are not blind-sighted by any unexpected fees. If you end up paying for a rate lock, it can be dependent on the amount of your loan and the prevailing interest rate.
You should be aware that rate locks can last up to 30 days in most cases; if you plan to take longer than that to complete your mortgage process, you should talk to your lender.

Consulting With An Expert

When you’re thinking about locking in a rate, you need to take guidance from a lender on the best way to do so. There are some risks associated with locking in a rate that you might not be aware of, and a reliable lender can help you through the process while making sure you’re aware.

Looking to Lock In Your mortgage rate lock? We’re Here to Help

If you’re shopping around for the best mortgage rates in South Florida, Pacific Lending Group can help. Our years of experience and excellence ensure that you never make a wrong decision regarding your home mortgage. Our mortgage professionals can guide you through the process, so you never have to second-guess yourself. Call us today at 954-227-4727 to schedule an appointment and get started with your home mortgage process.

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Difference Between 15-Year Vs. 30-Year Fixed Loans

When you take out a mortgage, options are to choose between fixed-rate mortgages and adjustable-rate mortgages. Fixed-rate mortgages interest stays the same for the entire life of your loan. In contrast, adjustable-rate mortgages have interest rates that change according to external market conditions.

Virtually all home loans are “fixed rate,” but they can be either short- or long-term loans. If you’re planning to buy a property, refinance your current mortgage, or consolidate debt, knowing the difference between 15-year fixed vs. 30-year fixed loans can help you make an informed decision.

Key differences between these two mortgages:

Length of the Repayment Period

Your monthly repayments will be higher than with a 30-year loan, but you’ll pay less total interest throughout the loan. This means you’ll own your home sooner and can potentially make a much larger payment towards equity, as the interest will build up over a shorter time.
A 15-year loan is often referred to as a “half-a-loan” because you’ll make half the number of payments you would with a 30-year loan.

Interest Rates
The interest rate on a 30-year fixed mortgage is always lower than that on a 15-year fixed mortgage. That’s because a borrower who opts for a 30-year term commits to paying the loan off in half the time so that they can expect a lower interest rate as compensation for the increased risk of such a long-term loan.

The interest rate on a 15-year fixed mortgage, by contrast, is generally higher than that charged on a 30-year fixed mortgage. That’s because the shorter term makes it less risky for lenders, so they are willing to charge a higher interest rate.

Mortgage Insurance
If you take out a 30-year fixed mortgage, your monthly repayments will be lower than an equivalent 15-year fixed mortgage. That means you’ll have more money available each month to pay your property taxes and insurance premiums at the start of your mortgage term, which will significantly reduce the amount of mortgage insurance you’ll need to pay.
However, this comes at a cost: Longer-term mortgages are riskier for lenders, requiring mortgage insurance. Your mortgage payments will include monthly MIP premiums, also called private mortgage insurance or PMI.

Why Bother With 15-Year Fixed vs. 30-Year Fixed?
As you can see, fixing the interest rate on a home loan for longer-term will result in a lower monthly repayment. This can be of major benefit to many borrowers.

One significant advantage is that you can afford a larger home by stretching out the loan term and still keeping your monthly repayments low enough to manage.

The biggest benefit of a 15-year fixed mortgage for many borrowers is that your monthly repayments will be lower than if you took out a 30-year fixed loan.

Banks typically require you to pay higher MIP premiums when you don’t have much to put down as a down payment or if your credit history is marred. A 15-year term allows you to put off paying higher premiums in the short term, even though your monthly premiums will be larger in the long term.

Contact Pacific Lending Group to Make the Right Choice

Pacific Lending Group has an extensive track record delivering competitive interest rates for 15-year and 30-year fixed loans to all credit profiles. Contact us today at 954-227-4727

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Factors That Matter When Refinancing Your Mortgage

Before deciding to refinance the mortgage on your home, you must take into consideration several factors. Failing to do so may result in a higher monthly payment than you want or even lead to paying PMI after refinancing.

The following information will explain what those factors are and how they can affect your refinancing experience.

Choosing the Right Lender

An important factor to consider when refinancing your mortgage is who will process your loan. Many lenders are floating around, but only a few of them will care about their customers and give them loans they can afford.
You should always shop around, compare interest rates and loan terms before going with a specific lender.

Interest Rates

One of the most critical factors when refinancing your home mortgage is the interest rate. This can have an extreme impact on how much you pay back every month. If you choose to refinance your mortgage, it is important to ensure that the interest rate after refinancing is at least half a percent lower than before refinancing. Failing to do so may lead to paying more per month than you originally planned.

Check for Hidden Fees

Before applying for any mortgage, you must check for hidden fees. This will ensure that you are not surprised by any costs or added interest during the time after refinancing your home. Many lenders try to charge customers fees to get them into a loan they cannot afford. Make sure these fees are reasonable before signing any contracts.

Home Equity

The amount of equity you have in your home can also affect how much you pay back per month after refinancing. Lenders will consider the current appraised value of your home when offering a new loan, but they will probably allow for higher payments if there is potential room to increase the price of your house. For example, if your house is worth $100,000 and you owe $80,000 to the bank, they may allow for higher monthly payments than they would if all of that money was already paid off. Also, if a home equity or is too low, refinancing your mortgage will probably be very difficult.

Your Credit Score

Your FICO credit score is the most critical factor when trying to refinance your home. If you have high credit, refinancing will probably be easier for you than poor credit.

Before choosing which lender to go with, your chosen loan officer will check your latest credit report to determine the best loan option for you. If they do not, it may be time to start shopping around for a new lender since your credit score is very important to them.

Choose Pacific Lending Group to Refinance Mortgage in Florida

Looking to refinance your home? Call Pacific Lending Group. They have worked with thousands of customers to help them secure loan options they can afford. If you would like to learn more about their services, including available interest rates for refinancing, feel free to give them a call today at 954-227-4727