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Mortgage Rates, Types and Terms – Three Things You Need to Know


The Spire

While there are several terms associated with the residential lending process, the mortgage rates type form the key components. These include the interest rate, the type of loan, and the term associated. Working with an experienced lender to determine how these three pieces fit together will determine the optimal mortgage product for your home purchase or refinancing needs.

  1. Rates remain near historic lows, but might not forever

Many mortgage experts, along with Fannie Mae, predict mortgage rates will remain near the lows witnessed earlier in 2021 through the end of the year. That said, specific rates are also affected by personal credit score and history as well as income and employment type. Additionally, mortgage rates, which can be fixed or adjustable, are one variable in the homebuying equation, and factors such as purchase price, down payment, and the maximum loan amount for which a borrower will qualify also need to be taken into consideration.


  1. Many Mortgage Types Are Available

While rates are a significant piece of the mortgage landscape, it’s also important to consider the type of mortgage loan that best meets your needs. While the most popular mortgage loan is the Conventional loan, there are several other options available to eligible borrowers, including:

  • VA Loans

○                VA loans are available to eligible veterans, active members of the military, and their spouses. They often have more lenient qualification requirements, do not require a down payment, and offer lower interest rates.

  • FHA Loans

○                FHA loans are insured by the Federal Housing Administration, an agency within the Department of Housing and Urban Development (HUD). With this type of loan, you generally may not need as high of a credit score or initial down payment that would be required with a conventional loan.

  • USDA Loans

○                USDA loans are a zero-down payment mortgage for eligible rural homebuyers and are issued by the United States Department of Agriculture.


  1. Multiple Terms Should Also Be Considered

Loan term, also referred to as the life of a loan, is also an important topic to consider when securing home financing. Many borrowers opt for a 30-year term, but there are other options available as well, such as a 15-year or an ARM. Both 15 and 30-year options are usually considered “fixed-rate”, where the interest rate will remain constant through the repayment period. Adjustable-rate mortgages, or ARMs, hold a steady interest rate for a specified amount of time at the beginning of the loan, and are then subject to vary after the initial period of time has passed.


Apply Now! 

If you are considering buying or refinancing, now is the time to take the first step! Our qualified team of loan professionals will guide you through the process to get you the financing you need for your perfect home.

A Lending Hand for Financing Home Mortgages

Spire Financial (A Division of V.I.P. Mortgage, Inc.) brings lending expertise to you. All of our loan officers offer personalized communication for every client, guiding them through the process. We can show you ways to maximize your finances and unlock future opportunities. Spire Financial keeps you in control of refinancing, debt consolidation, and home equity. Together, we can achieve your financial goals.