One of the most important things to consider when purchasing a new home or refinancing your existing property is how the regional housing market is performing. According to data provided by Zillow, Ohio home values currently stand at a median price of $135,800, compared to the median list price of homes for sale at $167,900.
Despite the turbulent market, Zillow reports that the median home value has increased by 6.8 percent between 2017 and 2018, an average that is predicted to rise another 6.2 percent over the next year. This upward trend has been reshaping Ohio’s otherwise uncertain housing marketing, leading some to suggest it’s a good time for homebuyers looking to invest.
If you’re searching for a home in Ohio, it’s important to note that mortgage purchase and refinance rates are impacted by the national marketplace. High-interest rates nationwide can contribute to higher loan rates, but these costs are typically offset by local economics, state laws, foreclosure rates, and competition between lenders in the region.
On an individual level, factors like credit score and credit history may also impact your mortgage and refinance rate, so gathering some preliminary information is a must. In this article, we’ll explain some of the important considerations you should keep in mind and offer advice about how to secure the best mortgage rates in Ohio.
Current Mortgage & Refinancing Rates in Ohio
5 Critical Elements That Affect Mortgage Rates & Refinance Rates in Ohio
Several determining factors influence mortgage and refinance rates in Ohio. To get the best deal, it’s essential to understand how these elements affect the overall rate. Doing a bit of research can save you thousands each year, allowing you to spend less and bank more.
- Loan Type: The type of loan you choose is one of the major determining factors for your mortgage rate. Depending on a homebuyer’s eligibility, lenders can offer a range of loan types, such as conventional, USDA, and FHA loans. Since rates can vary significantly depending on the type of loan selected, it’s always important to talk with multiple lenders to understand all the available options.
- Refinance type: A refinance loan is similar to a conventional mortgage in that the “type” of loan will determine what rate a lender can offer. Exploring all the options is the best way to learn which refinance loan type is best suited for your financial well-being. For example, a cash-out refinance loan will have much different rates than a rate-and-term refinancing option.
- Loan Term: In addition to the type of loan you select, lenders consider the expected duration of your loan when they set mortgage rates. Loans with shorter terms tend to offer lower interest rates but often require higher monthly payments. The best length for your loan typically depends on your income and level of savings. Short-term loans allow homebuyers with comfortable savings to pay off their mortgage quicker, whereas longer loan durations help buyers lower their monthly costs but extend the payback period, and therefore how much interest is ultimately paid.
- Credit Score: Credit score is one of the first things a lender will consider to determine if you qualify for a home mortgage loan. Buyers with low credit scores are often seen as high risk, leading to higher mortgage rates overall. Generally, the higher your credit score, the more likely it is that lenders will qualify you for a loan. This is true of refinancing as well, as credit scores are considered a primary factor in determining refinance rates. While it is still possible to secure a mortgage loan with less-than-perfect credit, it may be more challenging to qualify and negotiate the rate you want.
- Down Payment: Another significant factor when qualifying for a home mortgage is the amount you’re able to contribute as a down payment. The down payment amount typically impacts your overall interest rate: the more you’re ready to put down upfront, the lower your interest rate will be. Lenders see higher down payments as proof that a homebuyer has more stake in the property, which translates to less risk on behalf of the lender.
Considering these critical factors will help you narrow down your mortgage or refinance options until you’ve landed on the perfect loan rate for your financial situation. However, how do you turn insight into action?
How to Get the Best Mortgage & Refinancing Rates in Ohio
When it comes to finding the right mortgage or refinance rate in Ohio, comparative shopping is the only way to go. Homebuyers that understand all their options are better equipped to negotiate rates and associated costs, such as closing or lending fees. The more information you can gather, the more likely you are to find a mortgage or refinance rate that conforms to your financial needs. If you’re looking to secure an affordable rate but are unsure where to start, you may want to consider the following tips:
- Review your finances: Everyone looking to purchase or refinance is hoping for something different, which is why it’s so important to understand the full scope of your finances. One way to review your financial situation is to create a list of features and benefits associated with the property you’re looking at. Before you call up a lender, consider how market price, location, size, and amenities may affect the mortgage or refinance rate you’re aiming for. Knowing exactly how much you can afford will help you anticipate which loan types and payment schedules will work best for you, while also increasing your leverage during lender negotiations.
- Understand your mortgage and refinance options: Once you’ve reviewed your finances, the next step is to consider which types of mortgage or refinance options will suit your specific needs. Your offered rate will differ based on the type of loan you select and the repayment term you’re working with. For some, a fixed-rate mortgage may provide more long-term financial stability, while others may prefer the flexibility offered by a conventional loan. Doing some research into the pros and cons of each loan type is highly recommended, both for homebuyers and homeowners looking to refinance. Depending on your situation, the cheapest option may not always be the best choice, since rates tend to vary based on the unique preferences of the lender.
- Talk with more than one lender: There’s a myriad of lending institutions throughout Ohio, each offering different rates on mortgages, home loans, and refinancing services. Landing the best rate on your purchase or refinance loan requires a lot of research and persistence, which is why speaking to several loan officers from different lending institutions is always advised. Rather than relying on a single agent to search on your behalf, comparative shopping strategies can increase your chances of finding the perfect loan by allowing you to review as many options as possible. Once you’ve narrowed down your choices, be sure to ask the lending agent about any additional perks or benefits they may offer.
Recommended Companies in Ohio
With so many lenders offering competitive mortgage and refinance rates in Ohio, it can be difficult to know where to start. The most important thing to remember is that shopping around and comparing quotes is the only way to ensure you’re getting the best possible deal. Calling up lenders and asking questions requires no commitment outside of your time and attention, so don’t be afraid to shop around. Some of the top mortgage lenders in Ohio include:
- Quicken Loans: Our #1 choice for mortgage loans and services in Ohio. This lender is backed by a 90-Day rate protection guarantee, securing homebuyers from unexpected fluctuations in the market that may lead to rate increases.
- Rocket Mortgage: This lender offers a fully digital home loan experience through its innovative smartphone app, giving residents of Ohio access to a wide range of mortgage options with maximum convenience. First-time homebuyers may qualify for down payments as low as three percent!
- NBKC Bank: This banking institution is a leading “all-in-one” lender nationwide, offering full-spectrum mortgage services from origination to closing. They offer a wide selection of mortgage types, including conventional, VA, and FHA loans.
- Lending Tree: This massive online marketplace helps Ohio residents compare statewide mortgage rates to find the perfect deal. Unlike many lenders in the region, Lending Tree provides immediate quotes to homebuyers browsing for rates through their online service.