Wednesday, September 21, 2022

What Is The Average Mortgage Interest Rate In Massachusetts

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New Bedford Fall River And Taunton

Mortgage rates, rental prices increase

New Bedford, Fall River and Taunton are the three largest cities in the South Coast region of the state of Massachusetts. The entire region includes 11 municipalities with a combined population of about 306,588.

Formerly a whaling capital of the world, the seaport area is home to the largest Portuguese-American community in the nation.

Fishing and manufacturing are the largest businesses in the area, with jobs in tourism and education on the rise. Additionally, the area is embracing wind technology, and it hopes to be a center for that growing energy market.

The median home value in 2017 in New Bedford was $224,500, an increase of 8.7 percent over the previous year. Real estate experts expect that values will rise 3.7 percent over the next year.

The median listing price of in New Bedford was $209,800. The average price per square foot was $149, a price that is lower than the South Coast average of $198.

Why Does My Mortgage Interest Rate Matter

Your mortgage interest rate impacts the amount youll pay monthly as well as the total interest costs youll pay over the life of your loan. While it may not seem like a lot, a lower interest rate even by half of a percent can add up to significant savings for you.

For example, say a borrower with a good credit score and a 20 percent down payment takes out a 30-year fixed-rate loan for $300,000. In this case, an interest rate of 4.75% instead of 5.25% translates to more than $90 per month in savings in the first five years, thats a savings of $5,500.

Its equally important to look at the total interest cost of your loan. In the same scenario, a half percent decrease in interest rate means a savings of almost $33,000 in total interest owed over the life of the loan.

Why Compare Mortgage Rates

Shopping around for quotes from multiple lenders is one of Bankrates most crucial pieces of advice for every mortgage applicant. When you shop, its important to think about not just the interest rate youre being quoted, but also all the other terms of the loan. Be sure to compare APRs, which include many additional costs of the mortgage not shown in the interest rate. Keep in mind that some institutions may have lower closing costs than others, or your current bank may extend you a special offer. Theres always some variability between lenders on both rates and terms, so make sure you understand the full picture of each offer, and think about what will suit your situation best. Comparison-shopping on Bankrate is especially smart, because our relationships with lenders can help you get special low rates.

  • How do I find and compare current mortgage rates?

    Step 1: Determine what mortgage is right for you

    When finding current mortgage rates, the first step is to decide what type of mortgage best suits your goals and budget. Consider your credit score and down payment, how long you plan to stay in the home, how much you can afford in monthly payments and whether you have the risk tolerance for a variable-rate loan versus a fixed-rate loan.

  • Loan term
  • Interest rate type

Also Check: What Is The Lowest Fixed Rate Mortgage

Todays Mortgage Rates In Massachusetts

Whether youre ready to buy or refinance, youve come to the right place. Compare Massachusetts mortgage rates for the loan options below.

Compare current refinance rates today.

The mortgage rates shown assume a few basic things, including:

  • You have very good credit and a 20% down payment.
  • Your loan is for a single-family home as your primary residence.
  • You will purchase up to one mortgage discount point in exchange for a lower interest rate. Connect with a mortgage loan officer to learn more about mortgage points.

The Surprise Mortgage Rate Drop

dragonflydesignaz: Average Massachusetts Mortgage Interest Rates First ...

In 2018, many economists predicted that 2019 mortgage rates would top 5.5%. That turned out to be wrong.

In fact, rates dropped in 2019. The average mortgage rate went from 4.54% in 2018 to 3.94% in 2019.

  • At 3.94% the monthly cost for a $200,000 home loan was $948
  • Thats a savings of $520 a month or $6,240 a year when compared with the 8% longterm average

In 2019, it was thought mortgage rates couldnt go much lower. But 2020 and 2021 proved that thinking wrong again.

Recommended Reading: Can You Sell A House With A Reverse Mortgage

What Is A Good Mortgage Interest Rate

In general, you can consider a good mortgage rate to be the average rate in your state or below. This will vary depending on your credit score â better scores tend to get better mortgage rates. Overall, a good mortgage rate will vary from person to person, depending on their financial situation. In 2020, the US saw record-low mortgage rates across the board that continued into 2021. But rates have increased significantly since then.

Refinancing Your Mortgage In Massachusetts

Mortgage refinance rates are at all-time lows right now, so it could be a good idea to switch your current mortgage for one with a better interest rate especially if the new rate would be significantly lower.

You may decide to refinance with the same lender that gave you your initial mortgage, but it’s not always the best idea. A different lender may offer you a better deal the second time around. Shop around for a company that will offer the best interest rate and charge relatively low fees.

Also Check: What Is A Satisfaction Of Mortgage

Historical Mortgage Rates Chart

Despite recent rises, todays 30-year mortgage rates are still below average from a historical perspective.

Freddie Mac the main industry source for mortgage rates has been keeping records since 1971.

Between April 1971 and June 2022, 30-year fixed-rate mortgages averaged 7.77 percent. So even with the 30-year FRM above 5%, todays rates are still relatively affordable compared to historical mortgage rates.

Massachusetts Mortgage Rates Compared To The National Average

Loan Interest Rates: Mass Mutual | IBC Global, Inc

As noted, Massachusetts has the fourth-highest home prices in the nation, following only California, Washington, D.C. and Hawaii. One reason for the high home values is that the household income in Massachusetts is $20,000 above the national average. Housing prices in the state have also increased since the pandemic began, which is a trend spotted in many states.

Luckily, Massachusetts home buyers currently have access to lower mortgage rates than much of the nation. The nationwide average interest rate in the second week of January was 2.94% on a 30-year fixed-rate mortgage, while the average for the same loan in Massachusetts was 2.89%.

Also Check: What Were The Lowest Mortgage Rates Ever

Should I Lock In My Mortgage Rate Today

Locking in a rate as soon as you have an accepted offer on a house can help guarantee a competitive rate and affordable monthly payments on your home mortgage. A rate lock means that your lender will guarantee you an agreed-upon rate for typically 45 to 60 days, regardless of what happens with average rates. Locking in a competitive rate can protect the borrower from rising interest rates before closing on the mortgage

It may be tempting to wait to see if interest rates will drop lower before getting a mortgage rate lock, but this may not be necessary. Ask your lender about float-down options, which allow you to snag a lower rate if the market changes during your lock period. These usually cost a few hundred dollars.

Why Is My Mortgage Rate Higher Than Average

Not all applicants will receive the very best rates when taking out a new mortgage or refinancing. Credit scores, loan term, interest rate types , down payment size, home location and the loan size will all affect mortgage rates offered to individual home shoppers.

Rates also vary between mortgage lenders. It’s estimated that about half of all buyers only look at one lender, primarily because they tend to trust referrals from their real estate agent. Yet this means that they may miss out on a lower rate elsewhere.

Freddie Mac estimates that buyers who got offers from five different lenders averaged 0.17 percentage points lower on their interest rate than those who didn’t get multiple quotes. If you want to find the best rate and term for your loan, it makes sense to shop around first.

Read Also: What Type Of Mortgage For Rental Property

What Is The Difference Between The Interest Rate And Apr On A Mortgage

Borrowers often mix up interest rates and an annual percentage rate . Thats understandable since both rates refer to how much youll pay for the loan. While similar in nature, the terms are not synonymous.

An interest rate is what a lender will charge on the principal amount being borrowed. Think of it as the basic cost of borrowing money for a home purchase.

An represents the total cost of borrowing the money and includes the interest rate plus any fees, associated with generating the loan. The APR will always be higher than the interest rate.

For example, a $300,000 loan with a 3.1% interest rate and $2,100 worth of fees would have an APR of 3.169%.

When comparing rates from different lenders, look at both the APR and the interest rate. The APR will represent the true cost over the full term of the loan, but youll also need to consider what youre able to pay upfront versus over time.

Factors In Your Massachusetts Mortgage Payment

Current Trend For Home Mortgage Rates

On top of your principal and interest payment, you have to pay property taxes to the city or town your home is in four times a year in Massachusetts. While the Massachusetts average property tax rate seems manageable at 1.17%, the median property tax bill is $4,899. Thats due to the state’s strong housing market and high home values, which lead to a higher overall tax bill.

Your property taxes are based off of your homes assessed value and the areas tax rate. The Bay State assesses residential real estate each year to determine the market value. Your property bill will be based off of that number, so if you have any issue with the assessment, you can file an abatement application. This isnt guaranteed to get accepted but if it is, youll receive a refund for a portion of your property taxes. Senior citizens, veterans and blind residents can apply for property tax exemptions. The complete list of qualifying exemptions can be found on Massachusetts Department of Revenue property tax information website.

Another ongoing cost that accompanies your property tax and mortgage payments is homeowners insurance. In Massachusetts, the average annual premium is $1,485, according to Insurance.com data. That makes it one of the most expensive states for homeowners insurance premiums.

Also Check: What Does Icd Stand For In Mortgage

First Time Home Buyer Programs In The State Of Massachusetts

The state of Massachusetts doesnt directly offer any first-home homebuyer programs, but other organizations within the state do. MassHousing is an independent agency in the state that helps homebuyers find affordable housing solutions. MassHousings offerings include:

  • The MassHousing Mortgage This program helps low and moderate-income borrowers buy a home as long as they meet certain income and credit requirements. The mortgage is available through more than 100 lenders in Massachusetts.
  • MassHousing Down Payment Assistance This program provides buyers with down payment assistance for up to 5% of a homes value. The maximum benefits vary depending on where in the state you are located.

Reverse Mortgage In Massachusetts

Citizens 62 years and older can take out a loan against the equity of the home they currently live in with no need for repayment till the house changes hands. The interest on the mortgage is a sum of the one-year treasury rate, a margin, and a cap on the rate change. On the flip side, recipients of this loan are not allowed to take out a second loan or rent out the home. There are other intricacies to the loan, and they should be studied carefully with legal aid to understand their implications.

Recommended Reading: Can I Add Renovation Costs To My Mortgage

Work With What Works For You

It’s a market out there, and everyone is trying to sell their mortgage loan services. As such, they will announce mouth-watering rates on the surface, but you will need to be discerning enough to see past the ‘once-in-a-lifetime opportunities’ dangled in front of you.

In reality, some of the ‘friendly rate’ offers might not be as juicy as they are touted when applied to you, as they may only cater to prospective homeowners with a specific credit score or the ability to pay more significant down-payments. Thus, to make a more accurate estimation of the market, you would need to get personalized rates. This is known as getting Pre-qualified.

Prequalification involves presenting details about your credit score, loan amount, and down payment cost to the mortgage provider so they can give you a tailor-made rate quote based on the current rates. Doing this helps you to be more realistic about your prospects while giving you a better basis for comparison between offers. We provide a rate quote form at the top of this page that can be used to calculate these rates for you.

Find A Mortgage Loan Officer In Massachusetts

Dealing with Higher Mortgage Rates

Our local mortgage loan officers understand the specifics of the Massachusetts market. Let us help you navigate the home-buying process so you can focus on finding your dream home.

Loan approval is subject to credit approval and program guidelines. Not all loan programs are available in all states for all loan amounts. Interest rate and program terms are subject to change without notice. Mortgage, home equity and credit products are offered through U.S. Bank National Association. Deposit products are offered through U.S. Bank National Association. Member FDIC. Equal Housing Lender

  • Conforming fixed-rate estimated monthly payment and APR example: A $225,000 loan amount with a 30-year term at an interest rate of 3.375% with a down payment of 20% and no discount points purchased would result in an estimated principal and interest monthly payment of $994.72 over the full term of the loan with an Annual Percentage Rate of 3.444%.

    Estimated monthly payment and APR calculation are based on a down payment of 20% and borrower-paid finance charges of 0.862% of the base loan amount. If the down payment is less than 20%, mortgage insurance may be required, which could increase the monthly payment and the APR. Estimated monthly payment does not include amounts for taxes and insurance premiums and the actual payment obligation will be greater.

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  • Read Also: How Do I Find Out Who Owns My Mortgage Loan

    What Is The Average Mortgage Payment

    From down payments to mortgage payments, private mortgage insurance and homeowners insurance, theres a lot to consider when youre buying a home. Upfront costs are easy enough to calculate, but one important factor to consider is whether youll realistically be able to afford your mortgage payment and if youre even ready to buy a house given your monthly income.

    Of course, the specific amount of your mortgage payment will depend on many things, including the size of your down payment, your mortgage rate and the size and duration of the loan. But examining the averages in these areas can help prospective home buyers examine their budget to avoid financial headaches down the road.

    How To Get A Mortgage

    Because a home is usually the biggest purchase a person makes, a mortgage is usually a households largest chunk of debt. Getting the best possible terms on your loan can mean a difference of hundreds of extra dollars in or out of your budget each month, and tens of thousands of dollars in or out of your pocket over the life of the loan. It’s important to prepare for the mortgage application process to ensure you get the best rate and monthly payments within your budget.

    Here are quick steps to prepare for a mortgage:

  • Build your credit
  • > > Read more: How to get a mortgage guide

    Different types of mortgages

    There are many different types of mortgages and its important to understand your options so you can select the loan thats best for you: conventional, government-insured or jumbo loans, also known as non-conforming mortgages.

    Recommended Reading: What Is A Good Ratio Of Mortgage To Income

    Costs That Impact A Mortgage Payment

    New homeowners may not realize each of the expenses that go into their mortgage payment. Monthly payments include:

    • Principal: The principal is the amount of money you borrow when you initially take out your mortgage. This can be calculated by subtracting your down payment from the homes selling price.
    • Interest: This makes up the second major part of your monthly house payment and serves as the money you pay your mortgage lender in exchange for their giving you the loan. Interest rates are typically determined using an annual percentage rate .
    • Property taxes: The taxes you pay on your property go to your local government to fund road repair, public schools, fire departments and more. New homeowners may be surprised to learn property taxes can be one of the most expensive parts of the mortgage payments.
    • Homeowners insurance: Although its not legally required to own a home, most mortgage lenders will not provide a loan without homeowners insurance. This covers damage from home fires, break-ins and more.
    • Homeowners association : If your home is in an HOA community, there are certain rules, regulations and fees that come with it. This is most common with townhouses, multi-unit apartment buildings and condominiums. The fees you pay for belonging to an HOA may assist in trash pickup, landscaping, security and maintenance, and also provide access to the amenities on property.

    Massachusetts Mortgage Resources And Intricacies

    Mortgage interest rates remain low

    As you begin your homebuying journey in Massachusetts, there are several resources to help you navigate through the process. First, youll need a mortgage calculator to assist you as you keep track of the ever-changing mortgage rates. A competitive interest rate is one way to save on your mortgage, but there are other steps you can take to save even further.

    When it comes to purchasing or refinancing, specifically in Massachusetts, you can find additional resources through MassHousing. MassHousing is a public agency dedicated to finding affordable housing solutions for those currently living or planning a move to the Commonwealth. If youre a first-time homebuyer in Massachusetts, you might find the Massachusetts Housing Partnership a useful resource.

    If you find yourself facing foreclosure, the Massachusetts Division of Banks is another resource to explore. The Division of Banks has programs to help residents who are amid foreclosure and facilitates programs between lenders and borrowers to help avoid foreclosure.

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