A mortgage loan is a loan given to you by a lender that finances the purchase of a home. After a mortgage is closed you feel relief and excitement; however, the process before that can be stressful. Therefore, before you obtain a mortgage, it is important to know the rates and facts about the mortgage. Mortgage rates change frequently, so you need to check the current rate being offered by lenders. Each lender is different and charges different fees, so research the best lender available. You also need to know the types of mortgages available. You can obtain a mortgage with a low down-payment amount. Kentucky is a state in which many people will be buying a house within the next year.
Kentucky Mortgage Loan Laws
In Kentucky, lenders cannot discriminate based on race, religion, or gender. When you have been approved for a loan, lenders must provide you with a Truth in Lending Statement. This document must state the annual percentage rate, finance charges, amount financed, total number of payments, and the sales price of the mortgage. If you change your mind, you have three days to cancel a loan. Lenders are not allowed to mislead you and deceive you. Lenders are also required to give you a Good Faith Estimate. This states the closing cost that will be required for the closing. All mortgage lenders in the state of Kentucky are required to obtain licenses.
Kentucky Mortgage Rates
According to https://www.zillow.com/mortgage-rates/ky/, the average rate of a mortgage in Kentucky for a 30- year fixed loan is 4.05%. A 20-year fixed loan is 3.78%, while a 15-year fixed loan is 3.24%. An adjustable rate mortgage, the rate for a 7/1 ARM stands at 3.41%, and a 5/1 ARM is 3.17%. If you get a 3/1 ARM, the rate is 3.48%. Mortgage rates in Kentucky fluctuate frequently, so keep checking each day for the rates available. The current rate is down 1 point from the previous week.
Types of Mortgages in Kentucky
Before you apply for a mortgage, you need to look at your options to see what kinds of loans are available. Some of the choices that you need to consider include:
- Fixed rate mortgages: With this type of mortgage, your rate will stay the same throughout the entire life of the loan. Your monthly payment will not increase or decrease, so it will easy to budget. You will know what to expect.
- Adjustable rate mortgages: With this mortgage, your rate will change periodically. An initial period of your mortgage will be fixed, and then your rate will fluctuate according to the market.
- Conventional loans: The government does not insure a conventional loan. You can obtain a loan with a down payment amount as little as 3%, and you can get pre-approved for the loan, so you will know how much you can afford.
- FHA loans: This mortgage is insured by the Federal Housing Administration. Anyone is eligible for FHA loans, but it is a good option for first-time home buyers. Your down payment amount can be as low as 3.5%.
- VA loans: The U.S Department of Veteran’s Affairs offers a VA loan, which is available to military service members and retired service members. You can receive financing of 100%, so no down payment is required.
- USDA loans: The United States Department of Agriculture offers this loan for people with low income.
Finding a Lender
It is important that you find a reliable lender. You will most probably be paying a mortgage loan for many years to come, so you need to lender with excellent customer service. When you have questions, you should be able to call your lender to speak with a friendly customer representative. Before you decide on a mortgage, use a mortgage calculator to find out how much you can afford. The rates will be determined by your credit score. If your score is high, you can obtain the best rates available. If your score is low, you might want to get it higher before you apply for a mortgage. Your lender should explain the process to you and make it as easy as possible to obtain a mortgage in Kentucky.