Getting a mortgage loan can cause you much stress and anxiety. However, you can obtain a loan without the tension and strain; you just need to know how mortgages work, so you can understand the process. In the state of Tennessee, the median price of home stands at 93,000. This is below the national average. Zillow states that there are just over 60,000 homes for sale in Tennessee, so you can find the perfect home for you. The capital of Tennessee is Nashville, and the largest cities include Nashville, Memphis, Knoxville, and Chattanooga. Nashville is known as The Country Music Capital of the World and is home to the Grand Ole Opry. The state has so much to offer residents. If you will be needing a mortgage loan, rates are going to be fluctuating within the next year, so keep an eye on the market.
Tennessee Housing Outlook
http://research.realtor.com/2017-national-housing-forecast/ predicts that the housing market will slow down somewhat; however, it will show moderate growth. Rates are expected to increase a little, which means that some people might not be able to afford a mortgage. Home prices are expected to increase and home sales are expected to increase, even with the higher interest rates. The younger generation is expected to dominate the home loan market. Cities are expected to see a growth in population throughout the next year; therefore, because if this growth, more homes will be sold.
Tennessee Mortgage Rates
The mortgage rates in Tennessee have decreased in recent days. Now is an excellent time to buy a home before rates go back up again. For a 30-year fixed mortgage, the rate is 3.97%, and for a 20-year fixed rate loan, the rate is 3.70%. For a 15-year fixed rate mortgage, the rate is 3.18%. For a 7/1 ARM, the rate is 3.39%, and for a 5/1 ARM, the rate is 3.20%. For a 3/1 ARM, the rate is 3.44%. To obtain the best rates, you need to have a good credit score. If your score is low, your rate might be higher.
Types of Tennessee Mortgage Loans
You will need to decide if you want an adjustable rate or a fixed rate mortgage. Fixed rate is the most popular type of mortgage as the rate will remain unchanged throughout the life of the loan. If you plan on staying in your home for an extended period of time, this is probably the best loan. Most lenders offer you the option of a 10, 15, 20, or 30-year term. If you choose a lesser amount, your payments will be higher, but you will pay less money interest over the life of the loan. With an adjustable rate mortgage, your rate will fluctuate according to market trends. If your home is only temporary, you might choose this option. If you go with an adjustable rate, make sure your budget can handle the possible increase in interest rate.
Other types of loans you need to consider include:
- FHA loan: A mortgage insured by the federal government. The credit requirements are more lenient, so this is a good choice for first-time homebuyers.
- VA loan: A mortgage insured by the federal government and is available to veterans and current service members.
- USDA loan: A mortgage sponsored by the US Department of Agriculture and is designed for low income home buyers.
- Conventional loan: A mortgage that is not backed by the federal government.
Applying for a Mortgage in Tennessee
A good lender will make the mortgage application process quick and hassle-free. The company should walk you through the process and tell you exactly what to expect. You can get pre-qualified for a loan, so you will know how much you can pay for the home. Lenders will ask you to submit important documents. They will pull your credit score and examine your credit report. Your income will need to be verified, and the lender will want to make sure that you have the ability to repay the loan. After your loan has been approved, your lender will set up a time and a place for you to close on the loan. You can then enjoy living in the home of your dreams.