Learning the Benefits of No Cost Mortgages

key in front of house

At Altius Mortgage and our partners at Mortgage Ogden, it’s our mission to get you the best mortgage option for your situation. Our mortgage brokers are trained to spot the details that might make a certain type of mortgage or refinance more prudent for you and your family, and to guide you through every step of the process.

One of the mortgage types that often fits for many people is a no cost mortgage. This is a type of mortgage or refinance option where closing cost and fees are waived and instead rolled into monthly payments, allowing you to get out the door for much less in upfront costs. These are often great for people planning to move or flip a home within five years, and they hold several specific benefits. Let’s take a look.

Less Up Front

The absence of upfront closing costs and various fees means you need to bring less cash to the table. This is great for people who may have a high monthly income and enough funds to afford a solid payment, but not much liquid cash on hand for both a down payment and closing costs. Closing costs can run into the thousands for most mortgage situations, so this is a major benefit for many people.

Larger Homes

One of the primary benefits of this extra money is potential space in the home. No closing costs means you have more money available for the down payment and future monthly payments, which allows many people to get into a larger home than they had anticipated. It’s not uncommon for this lump sum to make the difference between a great home and a dream home.

Extra Necessities

No cost mortgages can often be perfect for many first-time homebuyers – people who often don’t have furniture or other accessories in the quantities truly needed for home ownership. Things like refrigerators, washers, dryers and dishwashers don’t come cheap, and if these are expenses you’re considering along with a mortgage, a no closing costs option could keep your finances in the proper order.

To learn more about no cost mortgages and when they might be right for you, or to find out about any of our other mortgage services, the brokers at Altius Mortgage and Mortgage Ogden are standing by.

5 Factors That Help Determine Mortgage Rates

couple talking with loan officer

Perhaps the most important consideration out there when searching for a mortgage loan is mortgage rate. The interest rate you qualify for on a mortgage might be the single largest factor in determining whether the mortgage ends up being a positive or negative financial investment.

At Altius Mortgage Group, we’re dedicated to providing our clients with the best possible rates and resources for improving rate qualification. What are some of the most important factors that go into determining interest rates for a mortgage?

Credit Score

Credit score might be biggest individual factor in determining rates for mortgages. It’s as straightforward as possible here: A high credit score gives you a better chance at a low interest rate, where a low credit score likely limits you to pretty high rates in most cases. Proper attention to your credit and debt payments leading up to a mortgage application is vital.

Loan Size

In many cases, the higher the loan amount, the higher the interest rate. This is usually simply because lending a larger amount counts as larger risk for the lender, and they have to adjust accordingly. Especially for jumbo loans, which exceed typical maximum loan limits, expect higher standard rates.

Loan Type and Length

The way your loan is structured can also be a varying factor for interest rates. Adjustable-rate mortgages tend to have lower rates than fixed-rate mortgages given how much they can change over the years, and shorter loans may come with lower rates. If you can afford higher monthly payments, try to lower the length of your loan to 10- or 15-year terms to get a lower rate.

Down Payment

The more money you’re prepared to put down up front toward the loan, the better. Lenders will view a higher down payment as offsetting risk, and will generally make your interest rate lower. The threshold here is often 20 percent of the loan total, though if you can go even higher, that’s even better.

The Market

This is a broad factor that will be present no matter how organized or disorganized you are on the other elements we’ve mentioned. Mortgage rates in recent years have been relatively low, but this is always a factor that can change based on a number of exterior factors.

Have questions about this or any of our other mortgage services? Our expert mortgage brokers at Altius Mortgage are standing by.