Buy a Home
We understand that buying a home is one of the most significant decisions you'll make—whether you're purchasing your very first home, downsizing for a simpler lifestyle, or upsizing to fit your growing needs. That’s why we’re here to guide you every step of the way.
Key Factors That Influence Your Mortgage Rate
- Credit Score: Your credit score plays a crucial role in determining your mortgage rate. Lenders view higher credit scores as an indication of financial responsibility, which could result in lower interest rates.
- Down Payment Size: The amount you can put down on a home impacts your rate. Larger down payments often lead to lower interest rates because they reduce the lender's risk.
- Loan Amount: The size of your mortgage loan can influence your rate, with both very small and very large loans sometimes facing higher rates.
- Loan Term: The length of your loan term—such as 15 years versus 30 years—can affect your rate. Shorter terms typically come with lower interest rates but higher monthly payments.
- Loan Type: Fixed-rate mortgages generally have higher rates than adjustable-rate mortgages initially but offer consistency over time. Your choice of loan type will influence your overall rate.
- Debt-to-Income Ratio (DTI): Lenders assess your DTI to determine your ability to manage monthly payments. A lower DTI often leads to more favorable interest rates.
- Market Conditions: Broader economic factors, such as inflation, Federal Reserve policies, and market trends, directly affect general mortgage rate levels.
- Property Type: The type of property you are buying—whether it's a primary residence, vacation home, or investment property—can impact your mortgage rate. Primary residences tend to have lower rates.
By understanding these factors, you’ll be better equipped to secure the best mortgage rate.
Example of a Mortgage Origination Fee and Comparison
Mortgage origination fees typically range from 0.5% to 1% of the total loan amount, depending on the lender and loan type. For example, if you are borrowing $300,000, an origination fee of 1% would be $3,000. However, not all lenders charge the same rate—some may offer a lower origination fee as an incentive to attract borrowers.
For instance, Lender A might charge a 1% origination fee on a $300,000 loan, resulting in $3,000, while Lender B offers a 0.5% origination fee, totaling only $1,500. Though the lower fee from Lender B may seem appealing, it’s vital to compare other terms and costs, such as interest rates or closing fees, to ensure the overall loan package aligns with your financial goals. Taking the time to weigh these factors helps you make a more informed and confident decision.
The right mortgage lender can make all the difference.
Not all mortgage rates and fees are created equal, and taking the time to compare can lead to significant savings over the life of your loan. Our loans are serviced in-house, ensuring that help is always nearby when you need it. As trusted local lenders who understand the market, we are dedicated to providing personalized support every step of the way. Let us help you turn your homeownership dreams into reality.
First-Time Home Buyers
ARMs can help first-time homebuyers afford a new home. However, careful consideration of your financial goals, risk tolerance, and long-term plans is essential. Consulting with a qualified mortgage consultant can help you understand your options and choose the loan that best suits your situation.
To assist first-time buyers or those who have not owned property for three years realize their dream of owning a home, SCU Credit Union offers a $500 discount towards closing costs on our Fixed Rate and Adjustable Rate Mortgages.
Whether you are a first-time homebuyer, planning to upgrade your current home, or looking to downsize, this seminar is designed to provide you with valuable insights and guidance throughout the home buying journey. Our knowledgeable speakers will cover these topics comprehensively, providing you with a clear understanding of the steps involved, the importance of credit, the roles of key professionals, legal considerations, and how SCU Credit Union can support you throughout the process.
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Get pre-approved with SCU Credit Union's Smart Start Program. Down payments starting at 3%, up to $1,000 closing costs credit, and fast processing.
What Mortgage Can I Afford?
This Coach session will guide you through setting a goal monthly mortgage payment and finding how much house you can afford.
It will also explain the main factors that affect mortgage costs. To begin the Coach session, select Get Started. Next, follow along, answer questions, and provide information when asked.
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Mortgage | Frequently Asked Questions
We can help.
We're a local community lender, so we're never far away. Buying a home can be overwhelming and the financing process can be a contributor to that stress. Complete the form below and a member of the team will reach out to help you.
Your Mortgage Resource Toolkit
A trove of tools and tips to transform your finances