If I get 6.5% with a 20% down payment approx how much higher will the interest rate be with 0% down?

Question

If I get 6.5% with a 20% down payment approx how much higher will the interest rate be with 0% down?

Please note I am only interested in 30 year fixed mortgages, is a 30 year fixed possible with 0% down?

Answer 1

The rate may be slightly higher - And a 1 loan is possible.....There are alot of factors to consider - if you go conforming you will have MI added on thru Wells Fargo - Chase - National City - just as an example, or you can have the rate be 6.75 with NO MI - you can get a 100 percent 1 loan or a 90 Pecent 1 loan - It all depands on your credit - etc....

Decide on how much you want to spend, if you want to escrow the taxes and insurance. Say the taxes are 1200 a YR and insurance 800 a year (just an estimate, ok) That is 2,000 a year divided by 12 = 166.66 If you paid 1,000 a month now - (166.66) your P/I Principle and Interest would be 833.34. Now you decided on the price range you are looking into. If you have great credit, a 1 loan at 130,000 at a rate of 7 percent over a 30 year time would be 864.89 - This is just a estimate - ok - It greatly depends if you need help with closing cost, if you have money to bring into the table - so you do not have to borrow the full 100 percent. Rates are still in the 6's but they are getting higher - ok. If your credit is in the 500's to low 600's than the rate would be higher - lots of factors to consider. Talk with a broker, a broker underwrites for many company's (I underwrite for 150 companies) so I only have to pull credit 1 time, and they look at my credit. A single lender (not a broker) has programs available, but they may not be able to help you and your situation, so you go elsewhere, and than that person pulls your credit (see what I mean.) If you shop, your credit is pulled and that is considered a soft pull, for a 30 day period. Just like shopping for a auto, it is good for 30 days. If you apply for a credit card, that is considered a "hard" pull and it drags down your credit score. Try to find someone (broker) that will pull your credit one time, and submit your loan application to company's that will go off his credit report. By the way, a loan application is called a 1003, and they will issue you a GFE (Good Faith estimate, with in 3 days, that is per the RESPA laws, and the TIL (Truth in Lending). This will tell you the up-front closing cost (etc) associated with your loan. This is a estimate only - not the final - but it does help you figure things out. Some companies want you to escrow you taxes and insurance. Other's may not require it...Some companies add a .25 to the interest rate if you want to escrow waver...FHA loans have to escrow (at least they used to) FHA loans have MI included, Conforming A+ borrower's loans have MI included, but the rates are better starting in the mid to high 6's (with rates going up.) The more money you borrow - the higher the rate normally. There are alot of factors involved.

With a government loan - collections and judgements will have to be paid (most ppl do not know that) but for FHA it is true....

Answer 2

Pen411 doesn't know what hes/shes talking about. Rates haven't been in the 5% range all year (unless your doing a 15 year term, and the best rates PAYING points is like 5.875%). Take the deal, its not bad at all! Martin also gave you solid advice on the 0% down. Ask your mortgage company for an 80/20 loan. An 80% first mortgage and a 20% second mtg. This will get rid of that pricey mortgage insurance. Act fast, the Fed increased rates again today! Good luck!

Answer 3

6.5% is a good rate right now with 0 points. I would take the deal at 6.5% for 80%, and do a 2nd mortgage for 20%. It's not a good idea to do one loan at 100%, you'll have to pay mortgage insurance, and the rate will be much higher, probably around 7-7.25% with no points. Depending on your credit, and the loan amount, a 2nd mortgage should be around 8%. The blended rate (1st and 2nd) is around 6.75%, and you wouldn't be wasting money on mortgage insurance.

Answer 4

Honestly, 6.5% with 20% down is a crappy rate, you should be in the low 5's with that much down.

And yes, you can get a home loan with no money down, good credit, stable work history and a good income, and at less than 6.5%!

Answer 5

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Answer 6

http://www.bankrate.com/brm/rate/calc_home.asp

here's some calculators you can use....