Here’s a question for you… for conventional rates, which credit score bracket should I use for pricing: 740 and higher or 720-739? With exception to the FHA/VA rates, I’m currently using 720-739. If our readers would prefer 740 and higher, I’m happy to adjust my Friday Rate updates…just comment here and let me know what you prefer.
Conforming Mortgage Rates (loan amounts up to $417,000 for 1-unit properties). The conforming rate quote below is based on owner occupied with a mid-low credit score of 720-739, “full doc” purchase with a sales price of $500,000 and a loan amount of $400,000 single family dwelling (non condo). This scenario includes reserves (taxes & insurance) not being waived. Rates quoted are priced based on a 30 day lock with no prepayment penalties on any of the rates quoted below.
30 Year Fixed @ 1 Pt: 5.000% (APR 5.138%). Coincidently the same rate as last Friday’s post.
30 Year Fixed @ 1 Pt with mid-credit scores of 740 or higher: 4.875% (APR 5.011)
15 Year Fixed @ 1 Pt: 4.625% (APR 4.858%) 
0.125% to rate
Conforming High Balance Rates. Pricing is based on the same criteria above except where the loan amount is $417,001 – $506,000 for properties in King, Snohomish or Pierce Counties; specifically priced for a sales price of $625,000 and a $500,000 loan amount.
30 Year Fixed @ 1 Pt: 5.75% (APR 5.891%) 0.375% to rate
FHA. Pricing based on credit score of 620 or better and loan amounts up to $417,000 for FHA in King, Snohomish and Pierce Counties.
30 Year Fixed @ 1 Pt: 5.500% (APR 6.179%).
FHA-Jumbo/High Balance. Pricing based on loan amounts from $417,001 – $506,000 for King, Snohomish and Pierce Counties.
30 Year Fixed @ 1 Pt: 5.875% (APR 6.553%) 0.375% to rate
VA. Pricing based on credit scores of 620 or better based on loan amounts up to $417,000. VA loan amounts over $417,000 are also available.
30 Year Fixed @ 1 Pt: 5.500% (APR 5.612%). 0.125% to rate
Prime Rate (what HELOCs are based on): 3.25%
12 Month LIBOR (what a majority of ARMs are based on): 1.92250% per WSJ.
This is just a small sample available of rates and products. This is not a guarantee nor is it a commitment of interest rate. Rates are as of Friday, January 30, 2009 at 2:00 p.m. and may change at any time. Available programs may change at anytime as well. Check out RCG’s new Mortgage Info page for live rate quotes via my Twitter feed.
About Rhonda Porter
I think people like to see the lowest possible rate, then they can decide to “wait for it” if they are a hair off it.
Say you quote lowest possible as 5% and quote them 5.5%. They ask why not 5%? You say your score is 735 and you need 740 for that or your ratios need to be 33/40 and they are 32/45. They can decide to wait and get their score up or their ratios in line first, or take the 5.5%.
That puts the choice squarely with the customer.
Lowest possible helps them understand the premium they are paying for being a bit “off”.
Hi Rhonda,
I think you’ve already done a blog post on credit scores and how the score correlates to the rate.
The problem with showing *only* the lowest rate is that it might be seen as somewhat deceptive if only a small percentage of people would qualify for that rate.
I’d want to see a rate quoted for what the largest percentage of homeowners typically will fall under. So for example, if most homeowners are somewhere between 600 and 700, then quote between that range.
I also like what you’ve done above which is to show the difference between the top score and the next lowest.
I’m curious to know if the rates get even BETTER than that, for people 780-800+.
Thanks Ardell and Jillayne. I’d love to hear from our readers too. My previous post about credit scores that I think you’re talking about Jillayne addressed my average client’s credit scores at the time, which is between 720-739. I’m not sure that represents the largest percentage of home owners. And I’d like what ever I do to appeal to RCG demographics.
I do share the concern of the rate seeming to be “bait and switch” a bit except for that it’s fully disclosed what the credit score requirement is. There are too many brackets w/conventional’s new price hits to show 600-700.
740 and higher is the best rate one can qualify for…especially if they have a 60% or lower LTV. 780-800 would be in this bracket.
I’m personally interested in rates for 740+, full doc, conforming, but I don’t have plans to buy for at least a year unless I find something that I love — at a significant discount to current market value.
So you can use me as a data point, but I also have no problem being happily surprised by a lower rate if I do decide to jump in.
Thanks Rhonda!
Thanks, Gene! Out of curiosity (although I’ll stick to 20% down for conventional) are you planning are putting more than 20% down when you purchase?
Rhonda,
It will really depend on things like what interest rates are at the time, purchase price, if there are lower rates for a higher down payment, etc. If interest rates remain low, I’d probably stick to a 20% down payment (certainly no less than 20%). I figure between the low rates and inflation eventually rising significantly (even if its 5-10 years from now), I’d need a really good reason to lock more of my money up for 30 years.
Speaking of which, I’ll almost definitely go for a 30 year, rather than a 15 year, due to the flexibility. I prefer having the ability to pay extra toward the principal, but keep the option for lower monthly payments if needed.
I would like to see the lowest score possible. My credit score is approximately 800 and if/when I do buy it will most likely be with 20% down (more than 20% would be tough). We are trying to buy within the conforming limit, but it may possibly be a high balance conforming price.
If you choose not to use this lowest rate, is there another website that you would recommend for this information?
Hi! I’d like to see the rate hits between 600 and 700 FICO mid, but it’s just a curiosity question, so maybe I’m just being high maintenance
Also, where is FHA going? Isn’t it about time for them to recalc the FHA max county by county?
Slightly out of touch (I left the biz), but glad you guys are here; I love RCG!
rhodio
Wups. Found it. thx. (Duhhh)
SeattleJo, do you mean highest credit score/lowest rate (740+) or lower credit score/higher rate (720-739)?
rhodio,
rate hits between 600 – 700 for conventional are with 75.01-80% LTV are:
700-719 = 0.75% hit to fee. (see below).
680-699 = 1.50% hit to fee.
660-679 = 2.50% hit to fee.
659-620 = 3.00% hit to fee.
These days, with little rebate pricing, a hit to fee could also be considered an add to rate since 1 point in fee is close to 1% in rate. For example, if your score mid-score is 740 and your spouse is a 719, we have to use the 719 meaning your rate is now 0.75% higher or your going to pay 0.75% more in loan amount than you would if you had a 740 or higher mid score.
In reality, with credit scores below 680, you may be going FHA. I’m seeing NEW price hits for FHA loans for credit scores of 600-619 of 1.00% effective February 2009.
Rhonda
RE #10
I meant highest credit score, lowest % rate
SeattleJo, I’m leaning towards 740+ credit w/80% LTV (60% will provide a better rate…but…)… especially since 1 point in fee is pretty close to 1% in rate these days, people can roughly figure out what their rate would be and can always contact a local mortgage professional to get a fine-tuned rate.
I’d say it makes sense to use the 740 FICO. Close enough to the average of ACTUAL homebuyers today, I figure, and probably better aligned with score of typical/average readers of RCG.
I would NOT suggest using the 60% LTV figure, since that has to be only a tiny fraction of buyers that would put 40% down.
Furthermore, since this is primarily a site for RE people, I would not include the various pricing hits involved with refinances.
For a quick reality check, take a look at the hits Fannie and Freddie have added in the past year.
http://tinyurl.com/fma-fico
I know it’s agit-prop from NAMB, but that does not mean that it is not true!
Good to visit with you today, Rhonda!
Thanks, Roger. I am sticking with 20% down (except for FHA/VA) and I’ve always viewed my rate posts here as being more towards the “purchase” market…otherwise, the lock period would be longer for a refinance.
It was nice to see you (and Jillayne) too!