Mortgage Note Rate

Mortgage Term of the Week: Mortgage Note Rate

Ever wondered what that "interest rate" on your mortgage means? Let's break it down! The mortgage note rate, or simply interest rate, is the percentage the lender charges for borrowing money for your home loan. It's like the heartbeat of your mortgage, influencing how much you pay each year in interest and your monthly payment. *Bonus Tip*: If you have a fixed-rate loan, the note rate remains constant throughout the loan term. With an adjustable-rate mortgage (ARM), the note rate is initial and can change over time, depending on market conditions.

Here's a quick example: Say you snag a $150,000 mortgage for 30 years at a 6% interest rate. That 6% is your note rate, reflecting your commitment to repay the loan at that rate or it would adjust according to the market conditions.

But wait, there's more! Many factors that contribute to your note rate:

-Market conditions

-Credit score

-Down payment

-Loan type and term

-Loan amount

-Home's location

-Fixed or adjustable rate

Understanding these factors can help you secure the best rate for your dream home. Contact Bob Flynn today!