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Buying a new home can be such a thrilling experience. You get to find the perfect residence for your family, and you get to experience the joys that come with being a homeowner. However, before you finalize the purchase, you must obtain a mortgage loan. This can be a daunting and exhausting event. You must find the right lender, and there is so much paperwork that needs to be completed. Many residents in the state of Pennsylvania will be in need of a mortgage. If you need a mortgage loan in Pennsylvania, it is important that you know how the loans work in the state.

Pennsylvania Mortgage Rates

One of the most important aspects of getting a mortgage will be your interest rate. These rates can fluctuate frequently depending on the market. You will want to make sure that you get the best rate available. In order to obtain the lowest rate, you need to have a good credit score. If your score is low, you will probably want to consider raising it before you apply for a loan. You can compare rates from different companies on sites such as Zillow. According to, the mortgage rate in Pennsylvania is 4.07% for a 30-year fixed loan. A 15-year fixed loan stands at 3.26%, and a 20-year fixed loan is 3.88%. If you prefer an adjustable rate mortgage, the rate for a 7/1 ARM is 3.38%, and the rate for a 5/1 ARM is 3.22%. For a 3/1 ARM, the rate is 3.43%. These rates are consistent with the nation’s average rates. Philadelphia is the largest city in the state, and the rate in the historic city is slightly higher for a 30-year fixed loan at 4.31%. The cities of Pittsburgh, Allentown, and Erie are also at 4.31%, according to Bankrate.

Applying for a Mortgage Loan in Pennsylvania

Before you apply for a mortgage, make sure you know your credit score. You can then search possible lenders to find a reputable and trustworthy one. With most lenders, you can get preapproved before you even start shopping for a home. This will let you know how much you can spend on a mortgage. Some of the documents that you will probably need when you apply for a loan include W-2 forms for the previous 2 years, paycheck stubs, bank statements and federal tax returns. There are numerous lenders who allow you to do all the loan process online until you close on the loan. At some point the lender will want the home inspected, and an appraisal will be ordered. When the steps are completed, you can meet at a location determined by the lender to close the loan.

Pennsylvania Mortgage Laws

Mortgage lenders are required by law to be fair and honest when presenting you with a loan. You must be given a loan estimate. This document should include the amount you will be charged, the annual percentage rate, amount financed, total number of payments, and total sales price. Lenders cannot discriminate against you based on your race, color, sex, religion, or handicap. Lenders give you a Good Faith Estimate, which will let you know the settlement costs. Lenders cannot practice deceptive or abusive lending, and they cannot harass you or disclose your information to third parties.

Types of Loans in Pennsylvania

You need to research the types of loans available to you before you apply for a mortgage. Some of these options include:

  • Fixed rate: Your rate will stay the same throughout the mortgage.
  • Adjustable rate: The rate could increase or decrease depending on the current rates.
  • FHA loan: A government-backed mortgage that will require as little as 3.5% down-payment
  • VA loan: A government-backed loan available to military members or retired military members.
  • USDA loan: Available to individuals with lower incomes.
  • Conventional loan: Available to people in Pennsylvania. You can get a loan with only a 3% down payment.

How to Qualify for a Mortgage

Requirements for a mortgage vary by lender, but the things that lenders consider are:

  • Credit score
  • Debt-to-income ratio
  • Monthly debt

Before you apply for a mortgage, you will want to make sure you meet the qualifications with the lender you choose.