This article will discuss factors that impact your rates, how to secure a better rate, and why mortgage rates are where they're today. We'll also walk you through several kid-friendly activities to keep your little ones engaged while living in Liberty County, Florida. Read on to learn more.
Are you a first-time homebuyer? Learn more about the available FHA home loan options in Liberty County, Florida.
Factors that Impact Your Mortgage Rate
Many factors impact your mortgage rate, each of which can affect you differently. Your mortgage rate can make or break your home-buying experience, so it's essential to understand the factors that determine your mortgage rate before you begin shopping around.
Let's look at some of the most influential factors determining your mortgage rate.
Your credit score is one of the most critical factors in determining your mortgage rate. A higher credit score shows lenders you're a low-risk borrower, which means you're more likely to repay your loan on time leading to a low-interest rate.
A lower credit score, on the other hand, can lead to a higher interest rate. You can do a few things to improve your credit score and increase your chances of securing a better mortgage rate.
Your down payment is another important factor in determining your mortgage rate. A higher down payment indicates to lenders that you're less of a risk ready to invest in real estate, and they'll be more likely to offer you a lower interest rate.
Plus, with a larger down payment, you'll have more equity in your home from the start and help you avoid paying private mortgage insurance (PMI).
The location of your property can significantly affect your mortgage rate. If you're looking to purchase a home in an area prone to natural disasters, your mortgage rate will be higher than if you were looking to buy a home in a more stable area. Also, the closer your property is to urban or highly populated areas, the higher your mortgage rate will be.
Furthermore, lenders will charge you a higher interest rate if you plan to purchase a home in an area with a high cost of living than someone buying in a more affordable area. To find the best deal, you should shop around no matter where you look for a property.
Mortgage rates can vary greatly depending on the type of loan you choose, and the type you choose will significantly influence your rate. The typical loan types include FHA, VA, USDA, and conventional loans.
Conventional loans are often subject to higher interest rates than other loan types because they are riskier for lenders. However, if your credit score is above 620 or your down payment is 20% or more, you may qualify for a better rate with a conventional loan.
If you're someone with less-than-perfect credit or with insufficient cash for a down payment, an FHA loan may be your best bet. They typically have lower interest rates than other mortgage loans.
VA and USDA loans have a lower interest rate than the FHA, but you must meet their specific eligibility requirements. The VA loan is available to veterans, active military personnel, and certain surviving spouses, while the USDA loan is designed for borrowers in rural locations.
Your loan term is the length of time you have to repay your mortgage. The most common loan terms are 30- and 15 years, but you can also get a 10-year, 20-year, or even 40-year mortgage.
The longer the loan term, the higher the interest rate will be. This is because lenders are taking on more risk by lending you money for a more extended period. Shorter loan terms typically have lower interest rates, but you'll pay higher monthly payments.
Interest Rate Type
If you're shopping for a mortgage, you'll hear about fixed-rate and adjustable-rate mortgages. A fixed-rate mortgage has an interest rate that remains the same for the entire term of the loan.
An adjustable-rate mortgage (ARM) has an interest rate that changes periodically depending on the state of the economy and real estate market.
ARM rates are generally lower than fixed-rate rates. But if the ARM's interest rate increases more than expected, your monthly payment could jump dramatically—and stay high even if market rates drop again.
Home Price and Loan Amount
Generally, the loan amount will be based on the price of the home you're interested in purchasing. Obviously, the higher the home price, the higher your mortgage rate will be. And the higher the loan amount, the higher the interest rate.
Ways to Secure a Better Rate on Your Mortgage in Liberty County, Florida
Your mortgage rate can significantly impact your monthly housing costs, so it pays to learn as much as possible about securing the best rate and keeping costs down along the way.
Here are four ways to help you secure a better rate on your mortgage and save you money over time.
Improve Your Credit Score
Another successful way to secure a better rate on your mortgage is to check and improve your credit score. A good credit score shows lenders that you're a responsible borrower, which can lead to a lower interest rate on your loan.
Check for errors in your credit history by requesting an annual free copy of your report from each of the three major credit bureaus. Be sure to compare them for accuracy before taking action based on what they say about you. Pay all your bills in full and promptly every month, and avoid applying for too many credit cards or loans.
Make a Huge Down Payment
Making a sizeable down payment is one of the best ways to secure a low mortgage rate. A down payment of 20% or more will help you avoid paying private mortgage insurance (PMI), giving you more negotiating power with lenders.
Plus, a larger down payment means you'll have more equity in your home, which can help you refinance at a lower rate if rates rise in the future.
Choose Your Loan Term Carefully
The mortgage loan term is one of the most critical factors in determining your interest rate. A shorter loan usually results in a lower interest rate, but it also means higher monthly payments.
On the other hand, a longer loan term will have a higher interest rate but lower monthly payments. Generally, you'll need to decide which is more critical: lower interest or monthly payments.
There's no substitute for shopping around when getting the best mortgage rate. Talk to multiple lenders and compare their rates, fees, and loan terms. Don't be afraid to negotiate – you may be able to get a lower rate if you meet all the eligibility requirements and willing to pay points.
The Driving Forces Behind Mortgage Rates Today
Mortgage rates may seem mysterious to some, but they are pretty simple. However, most people don't know much about the forces behind mortgage rates today. While these factors are out of your control, understanding them can help you understand why mortgage rates are where they're today and what to expect in the future.
So read on for an in-depth look at the main driving forces behind the current mortgage rates in Liberty County and the entire country.
The Federal Reserve
The Federal Reserve controls short-term interest rates, which rise and fall based on the state of the economy. Most people believe that the Federal Reserve sets mortgage rates, but it only influences them.
Although mortgage rates are not directly tied to the Fed's rate, the prime mortgage rate tends to follow suit shortly after the Fed rate changes.
Inflation directly affects mortgage rates because it represents the loss of purchasing power that a lender can expect over time. Higher inflation means higher interest rates and vice versa. Generally, mortgage rates stay the same or slightly fluctuate during periods of low inflation.
There are three main inflation types: demand-pull, cost-push, and built-in inflation. Demand-pull inflation is caused by rising demand for goods and services, which increases production costs and, therefore, prices. Cost-push inflation is caused by increased raw material or fuel prices, which drive production costs.
The expectation of future inflation leads to Built-in Inflation. An increase in prices results in wage rises to cover the cost of living increase. As a result, high wages increase the cost of production, which in turn impacts product prices.
The State of the Economy
Today, mortgage rates are influenced by various factors, including inflation, employment reports, consumer spending, and the Federal Reserve. The economy is ever-changing, which in turn, affects mortgage rates.
When the economy is doing well, mortgage rates will rise, while when the economy is not doing well, like when unemployment rates are high, the rates will fall.
The Bond Market
Mortgage rates are primarily determined by mortgage-backed securities (MBS) prices. When bond prices rise, mortgage rates usually fall, and vice versa. The reason for this is that bonds and MBS are both competing for investors' money.
When bond yields go up, investors demand a higher return for their investment, which drives up bond prices and pushes down mortgage rates. The reverse is true when bond yields fall.
The Secured Overnight Finance Rate (SOFR)
The Secured Overnight Finance Rate (SOFR) is an overall calculation of the expense of borrowing cash overnight collateralized by U.S. Treasury securities. It is summed as an average of transactions accomplished in the federal funds market and is publicized daily by the New York Fed.
The SOFR has replaced London Interbank Offer Rate (LIBOR) (which was phased out in 2021) as the preferred benchmark for short-term interest rates.
Kid-Friendly Activities in Liberty County, Florida
Liberty County, Florida, has plenty of fun things to do with your kids that are both affordable and accessible from wherever you are in the county.
Whether you're living in downtown Bristol or on the outskirts of Sumatra, there are many opportunities to make memories with your family, enjoy nature and boost your child's self-esteem while learning essential life lessons.
Check out these fun things with your kids in Liberty County, Florida, today!
Fly a Kite at Bryant Commons
Take your kids to Bryant Commons and let them fly a kite! It's a great way to get them outside and active, and they'll love being able to play with their favorite toy in a vast open space. If you don't have a kite, no problem - there are plenty of other fun things to do at the park.
Kids can climb on the playground equipment and ride bikes or scooters around the track. The park is open from sunrise to sunset every day and offers free admission!
Visit a Museum
Liberty County is home to several museums, perfect for a day trip with your kids. The Veterans Memorial Railroad (ORG), Liberty County Museum and Archives Association, Inc., and the Heritage Museum offer various interactive exhibits and activities that your kids will love.
The adults can learn about the county's rich history at the Thronateeska Heritage Center. And everyone can enjoy the beautiful displays at the Mattie Kelly Arts Center Galleries. Plus, there are plenty of picnic areas and playgrounds nearby if you need a break.
Visit a Park
There are quite a few attraction parks in and around Liberty County. Depending on what your kids are into, there's bound to be something that will spark their interest. These parks have everything from roller coasters and water slides to animal encounters and interactive shows.
You can even bring the family dog! Below are some of the popular attraction parks in Liberty County, Florida:
- Liberty County Recreation
- Liberty Co Recreation Department
- Larkins Landing
- Bristol Landing
- Torreya State Park
- Torreya State Park Loop Parking Lot
Horseback riding is a great way to bond with your kids while getting some exercise. And what could be more fun than galloping through the Florida countryside on a beautiful horse? Horse lovers can enjoy horseback riding and learn more about the different breeds at various horseback riding spots.
Whether a beginner or an experienced rider, these facilities offer programs for all skill and experience levels. Below are some of the popular horseback riding spots in Liberty County:
- Panhandle Peacemakers Riding Facility
- Iron Horse Boarding
- The Lazy C Ranch
- Red Oak Farms
- Foxtrot Farm
Explore the Various Lakes and Ponds
Liberty County is home to some of the most beautiful lakes and ponds in The Sunshine State. These springs are surrounded by nature and offer a wide variety of activities for your family to enjoy together.
Whether you want to go fishing, swimming, paddleboarding, kayaking, or relax and take in the scenery on a boat ride, Liberty County has something for everyone!
The following are some of the famous lakes and ponds to explore in Liberty County, Florida:
- Goss Lake
- Econfina Creek
- Hensen Lake
- Bristol Lake
- Talquin Dam
- Swan Pond
- Tiny Lake
As interest rates fluctuate, so do current mortgage rates in Liberty County, Florida. Despite the housing market's ups and downs, understanding current mortgage rates can help you navigate this process while you decide which home loan is right for you.
Invest your time and a little effort to learn more about current mortgage rates in Liberty County, Florida, and get started on your house-hunting adventure.
An excellent place to start is by visiting your local lender or contacting an approved housing counselor to help you determine the loan product and mortgage rate that fit your situation.