Over the past several years, property values have increased significantly in the Palmetto State. Real estate database Zillow reported that prices rose from a low median value of $120,000, reached twice in 2012, to a median home value of $162,000 in November 2018.
Although still significantly lower than the national median home value of $309,000 that the U.S. Census Bureau reported in October 2018, there’s an undeniable, long-term upward trend in South Carolina home prices. Homebuyers need to pay close attention to mortgage rates, terms, and conditions to find the most effective loan for their needs.
Mortgages Rates in South Carolina
From national factors like interest rates and economic performance to state-level concerns like lender competition and foreclosure rates, a variety of factors impact the rates and terms lenders will offer.
Considerations specific to South Carolina include a steadily increasing population leading to more demand, widely variable home prices between urban and rural areas, the potential for extreme weather to affect parts of the state, and much more.
To find the best mortgage for your needs, keep these factors in mind and read on to learn more about mortgage specifics, the benefits of comparative shopping, and top lenders in South Carolina.
5 Critical Elements That Affect Mortgage Rates & Refinance Rates in South Carolina
Understanding as much as possible about mortgage rates in South Carolina allows you to make an informed decision that can, over time, save you a significant amount of money.
Because providers and types of mortgages vary so much in the context of rates, terms, conditions, and other factors, finding the best mortgage rate for your specific needs can reduce the total cost of a loan by many thousands of dollars over its life.
To have a truly complete view of the mortgage market in South Carolina, you need to consider the underlying factors that affect all home loans and yours in particular.
- Down payment: Down payments are a widely variable consideration. Specific types of mortgages, such as the VA Home Loan for servicemembers and veterans, require very little or no down payment, while others call for the industry standard of 20 percent. Additionally, a larger down payment cuts down on the total amount owed, which reduces the total interest accrued over the life of the loan and individual monthly payments. A smaller down payment, while requiring more interest to be paid over time, reduces the up-front financial burden placed on a homeowner.
- Type of refinance: There’s no single reason to refinance a home loan, which entails securing a new loan that pays off the existing mortgage. Some people do so to take advantage of changing interest rates and other market conditions, reducing their monthly payments and saving more money over time. Others refinance to access the equity they’ve built up in their home over many years, using that money for a variety of other purposes. A refinance can also be initiated due to a desire to change between a fixed- and an adjustable-rate mortgage, avoid entering a state of negative equity on the property, and many other considerations. The Federal Reserve Board has an in-depth guide that helps homeowners learn more about the specifics of refinancing.
- Credit score: Unless you have enough cash on hand to purchase a home outright, and therefore skip the lending process, your credit score will almost certainly be a consideration as you attempt to qualify for a home loan. Some specialized loans, such as the ones secured by various government agencies, have more relaxed standards, and exact requirements can vary from one lender to the next. A higher credit score can lead to benefits like lower interest rates, and a lower lifetime cost of a mortgage because lenders view those with better scores as offering less risk. Conversely, a lower score can mean dealing with less-favorable terms and conditions, with more money going toward interest when paying off the loan.
- Loan term: Shorter and longer loan terms each offer unique sets of advantages and disadvantages. A shorter loan term, commonly 15 years, leads to higher monthly payments but lower interest rates and less total interest paid over time. This option is useful for those who may only stay in the home for a relatively short period or have the financial capacity to address the higher price each month. A longer loan term, commonly 30 years, leads to the opposite: higher interest rates and total interest accrued, but lower monthly payments.
- Length of refinancing: Just as the length of the term of an initial home loan influences major factors like interest rates and monthly payments, so does the length of a refinance. A longer term allows homeowners to spread the cost of the mortgage over a more extended period, although at an additional cost. A shorter term means a more considerable monthly expense, but lower overall cost and a better interest rate. Make sure to weigh the pros and cons as you choose between a shorter or longer term for your refinance.
How to Get the Best Mortgage & Refinancing Rates in South Carolina
Comparative shopping is a foundational step on the path to finding the mortgage that works best for your needs. Contrasting different types of widely available loans, determining if you qualify for specialized mortgages, and finding out which lender will provide you with the most competitive rates and terms helps you save money.
However, close to half of all Americans don’t consider multiple lenders, the Consumer Financial Protection Bureau reported, instead just choosing a single lender from the start.
When you compare all the options and lenders available to you, you have a better chance of saving money. Because mortgages are long-term loans, even a reduction as low as 0.5% in a loan’s interest rate can lead to savings of several thousands of dollars over the life of the agreement.
If you qualify for a specialized loan, such as the loan for rural homes offered by the USDA, you could save even more.
Make sure to request quotes from several lenders. Request quotes online at first to keep the process moving along, but reach out by phone as well if a lender doesn’t have online quotes or pre-approvals. Additionally, watch out for fees that crop up at the end of the mortgage process.
You can negotiate many of them down or eliminate them altogether. Fees frequently open to reductions include loan origination, document preparation, and title search, among others.
Recommended Mortgage Companies in South Carolina
There are a variety of lenders active in the Palmetto State. Some top options to consider include:
- LendingTree: LendingTree serves as an online platform for connecting homebuyers with potential lenders. Considering the importance of comparative shopping to securing the best possible mortgage rates and terms, the benefits of seeking out initial quotes via LendingTree is clear. The process is simple, too: Enter your information just once, and LendingTree will match you with up to five possible lenders.
- Quicken Loans: Quicken Loans is also a loan marketplace, connecting lenders and homebuyers across the country. Quicken Loans’ wide variety of lenders means it’s easier to find competitive rates on everything from traditional, 30-year, fixed-rate mortgages to jumbo loans and other specialized products. Quicken Loans also enjoys the best overall ranking in our internal review of lenders and marketplaces, with a score of 9.8/10.
- J.G. Wentworth: J.G. Wentworth features many very attractive benefits for prospective and current customers, including competitive interest rates, a quick and easy quote process and a wide range of mortgage products. Those seeking a loan can use a variety of methods to communicate with the lender, including email, phone calls, and live chat. J.G. Wentworth’s headquarters location has an A+ rating with the Better Business Bureau.
- Ally Bank: Ally Bank emphasizes its online-only nature by clearly displaying quotes and rates and offering a variety of interactive tools and other information about various parts of the home loan process. Lower overhead from a lack of need to rent or own real estate and staff locations contributes to the lower rates the bank offers. Loan officers are available