Why There’s No Single “Best” Mortgage Rate
I’m often asked, “I’m looking to purchase a home or refinance to save money—what’s your rate?”
The reality is, there is no single rate that applies to everyone. Your loan program and rate depend on several factors, including:
- Credit score
- Purchase or refinance
- Primary, second, or investment property
- Debt-to-income ratio
- Loan-to-value (LTV) or home equity
- Down payment amount
Each of these factors affects the interest rate and loan terms available to you, which is why your mortgage should be customized to fit your unique financial situation.
Purchasing a Home: Structuring Your Loan for Your Needs
Your down payment plays a major role in how your loan is structured. Many lenders recommend 15-20% down, but that may not always be the best option for you.
Lower Down Payment, More Financial Flexibility
Consider this example:
- Home Price: $600,000
- Traditional Down Payment (15-20%): $90,000–$120,000
- Alternative Down Payment (10%): $60,000, keeping an extra $30,000–$60,000 in savings
- Monthly Mortgage Insurance (MI) Cost: Only $95 per month
For many homebuyers, having extra cash in the bank for home improvements, emergencies, or other expenses outweighs the small added cost of mortgage insurance.
Would you rather put an extra $30,000–$60,000 into your home upfront or keep that money available for your future?
Refinancing: Why It’s More Than Just Your Interest Rate
Many homeowners secured historically low mortgage rates in recent years, making them hesitant to refinance. However, a low mortgage rate doesn’t always mean financial stability.
Refinancing for Financial Relief
Many homeowners today are facing:
- High credit card balances with interest rates ranging from 22-29%
- Student loan payments
- Income changes, such as a spouse losing a job or reduced work hours
- Unexpected expenses, like medical bills or home repairs
- Large car payments or other high-interest debts
Even with a higher mortgage rate, refinancing can be a strategic financial decision if it significantly reduces your overall monthly expenses.
Real-Life Example
A recent client had a monthly mortgage and credit card payments totaling $6,000. By restructuring his debt into a single mortgage loan, his new total payment is now $3,956, saving him $2,100 per month—or $25,200 per year in after-tax income.
That’s not just a mortgage decision—that’s peace of mind.
Finding the Right Loan for You
There is no one-size-fits-all mortgage. Just as everyone has different preferences for cars, doctors, or financial plans, your home loan should be tailored to fit your specific needs and goals.
With years of experience helping homeowners and first responders, I focus on finding the best loan strategy for your financial situation—not just offering a generic program.
Want to explore the best mortgage options for you? Let’s create a strategy that fits your needs and goals.
