Did you know that Mississippi has a homeownership rate that’s higher than the national average? That's right. A mortgage can be your ticket to joining those ranks. When shopping for the ideal mortgage, one key factor is the rate lenders offer. Opting for the best mortgage rates in Mississippi can greatly improve your borrowing experience. We’ll explore why it’s crucial for you.
Current Mortgage Rates in Mississippi
FRED Economic Data puts Mississippi’s 2022 homeownership rate at 73.1% — that’s 7% higher than the national average of 65.9%. Mortgages may have likely contributed to making the Magnolia State’s numbers shine.
If you are a procpective homeowner, let's get into current mortgage interest rates in Mississippi. For a 30-year fixed-rate mortgage, the U.S. average is 6.94%, but here in the state, it's slightly lower at 6.81%. For a 15-year fixed-rate mortgage, Mississippi also comes in lower at 6.26% compared to the national average of 6.31%. However, a 5-year adjustable rate mortgage in the state is a bit higher at 7.44%, against the national average of 7.28%.
Staying updated on mortgage rates helps you lock in the best possible deal. Timing your mortgage application when rates are favorable could save you thousands of dollars over the loan term. Mortgage rates, however, don't operate in a vacuum — they're part of a larger puzzle that includes different types of mortgages. Knowing your mortgage options in Mississippi can help you choose a loan that suits your financial situation.
Finding the Best Mortgage Rates in Mississippi
Mortgage rates can be key to your financial freedom. Competitive figures can mean the difference between paying tens of thousands more or less over the duration of your loan. Let's look at some unique ways to find the best mortgage rates in Mississippi.
Use rate locks: A rate lock feature allows you to freeze a favorable mortgage rate for a set period, typically 30 to 60 days. This strategy protects you from potential rate hikes, offering peace of mind as you finalize your mortgage.
Reduce existing debt: High debt levels can adversely affect the mortgage rate offered to you. Lenders assess your debt-to-income ratio to gauge your ability to manage payments. By reducing your existing debt, you present yourself as a lower-risk borrower, which can lead to a more favorable rate.
Seasonal rates: Rates often vary depending on the time of year. Historically, they tend to be lower during off-peak homebuying seasons like late fall and early winter. Being aware of this can give you an extra edge in securing a lower rate.
Larger down payment: A larger upfront payment can significantly reduce your mortgage rate. Lenders often see a bigger down payment as a sign of a serious, well-prepared borrower.
Use a co-signer: A co-signer can help secure a lower rate if your financial profile isn't as strong as it could be. His stronger credit score and financial standing can provide added assurance to lenders, helping you receive a more competitive rate.
Knowing these strategies equips you with the tools to find better home mortgage rates in Mississippi. The difference may seem small, but even a 0.1% lower rate can save you significant money in the long run.
Mortgage Types in Mississippi
The national average home value sits at around $348,126. In contrast, Mississippi's average home value is approximately $176,655. The difference underscores the affordability of housing in our state. Yet, even with more accessible home prices, understanding your mortgage options remains crucial to optimizing your finances. Consider the following:
These are non-government-backed loans commonly chosen for their flexibility.
Government-backed loans designed to help first-time homebuyers or those with less-than-stellar credit.
Exclusively for military service members and veterans, these loans are backed by the Department of Veterans Affairs.
Geared toward rural homebuyers, these loans are backed by the U.S. Department of Agriculture.
Being aware of these mortgage types can be a significant chapter in your homeownership story. Each one comes with its own set of rates, which directly impacts how much you'll pay over time. But beyond this, it’s also best to look at two fundamental mortgage rate structures:
Fixed-Rate Mortgages: Once you lock in an interest rate, it stays the same throughout your loan term, which is great for budgeting your finances. You won't have to worry about rising interest rates affecting your monthly payments. If you value stability and plan to stay in the home long-term, it might be your best bet.
Adjustable-Rate Mortgages (ARMs): These start with a lower initial interest rate, which can change over time based on market conditions. While this option could offer lower initial payments, there's the risk of rates and payments increasing in the future. ARMs often work well for those who aim to sell or refinance their home before the rate adjusts.
As you navigate home mortgage rates in Mississippi, the key takeaway is to align your mortgage type and rate structure with your financial plans and lifestyle. It isn't a one-size-fits-all situation, so it deserves the same care and personalization as choosing your future home.
A mortgage calculator is more than just an online tool — it's your personal guide in the mortgage journey. You can estimate your monthly payments with it based on different mortgage rates in Mississippi, down payment amounts and loan terms. It allows you to forecast your financial future better, helping you choose a mortgage that fits comfortably within your budget.
So why not give it a try? Check out MoneyGeek’s mortgage calculator and start exploring your options. Understanding how different inputs affect your monthly payment can make the complicated world of mortgages feel more manageable.
How to Get a Mortgage in Mississippi
Knowing how to secure a mortgage in Mississippi can make the difference between a stressful and a smooth homebuying experience. Understanding the steps can save you time and potentially help you lock in more favorable current mortgage interest rates.
Pre-qualification and Pre-approval
Both are initial steps that give you an idea of how much you can afford. Pre-qualification is a quick process with a lender using your income, assets and debts to gauge your borrowing capacity. Pre-approval is more thorough, requiring documentation and a credit check. Being honest and accurate from the get-go helps you avoid unexpected hitches later.
Finding the Right Lender
Before submitting your application, it's crucial to research and find a mortgage lender that offers favorable terms and good customer service. The right one can significantly impact the mortgage rates offered to you and the overall loan experience.
As you go lender shopping, organize all required documents like pay stubs, tax returns and proof of assets in a digital folder. It streamlines the process and makes it easier to submit the needed paperwork quickly.
Submit a comprehensive mortgage application to your chosen lender, ensuring you fill out all sections meticulously. A detailed, error-free application speeds up the approval process.
Home Inspection and Assessment
Before finalizing your loan, most lenders require a home inspection and an assessment to determine the property's value. Both are essential steps in ensuring you're making a wise investment.
Loan Estimate Review
You'll receive a loan estimate detailing the terms, interest rate and monthly payments. Review it against your initial pre-qualification and pre-approval figures to ensure no discrepancies.
Attend the closing meeting to sign all final documents, making the loan official. Pay close attention to what you're signing and don't hesitate to ask questions to clarify any terms or conditions.
Understanding the process of getting a mortgage can help you navigate the financial landscape better. When you know what to expect, you’re more likely to snag great current mortgage interest rates in the state and make your journey to homeownership less daunting.
Mortgage Programs in Mississippi
Owning a home comes with its own set of financial responsibilities, such as insurance premiums and utility bills. Thankfully, the Mississippi Home Corporation offers programs to ease this burden. These programs can help you better manage mortgage rates by offering various forms of assistance, like down payment aid or discounted interest rates.
These programs can be a real game-changer, especially if you're keeping an eye on current mortgage interest rates in Mississippi. They can mean the difference between managing your payments and enjoying your new home.
This program offers a 30-year fixed-rate first mortgage, allowing you to lock in a competitive rate for the long term. You can get a second mortgage for up to $6,000 to cover your down payment or closing costs, and it comes with zero interest.
Smart6 has got you covered whether you're looking into FHA-insured, VA, Rural Development, Fannie Mae or Freddie Mac Loans. There's also no limit on your liquid assets. You can even pair Smart6 with MHC's Mortgage Credit Certificate program for even more savings.
You don’t have to be a first-time buyer unless you're using the Mortgage Credit Certificate. Your income should be below $122,000 per year, and you must plan to make the property your primary residence. As for the home, it needs to be in Mississippi, but you can pick from a single-family home, townhouse or even a condominium.
Mortgage Revenue Bond 7 (MRB7)
Mortgage Revenue Bond or MRB7 aims to make homeownership more achievable through proceeds from tax-exempt Mortgage Revenue Bonds. In simpler terms, the program offers competitive mortgage rates and even throws in a $7,000 down payment aid. This assistance is deferred for 10 years and carries zero interest.
You'll qualify if you're a first-time homebuyer or haven't owned a home in the past three years. However, even if you’re not a first-timer, there are special “target areas” and veteran exemptions. Your creditworthiness should align with FHA, VA, Rural Development, Freddie Mac or Fannie Mae guidelines. Plus, your income should fit within your county’s specific limits.
The property you’re eyeing should be in Mississippi and could be a new or existing single-family home, townhouse or condominium. Manufactured homes are also an option if they're permanently affixed to the land.
The program lets you enjoy a 30-year fixed-rate mortgage, giving you the peace of mind that comes with steady payments. And don't worry about liquid assets — there's no limit here.
Housing Assistance for Teachers (HAT)
Established under the "Mississippi Critical Teacher Shortage Act of 1998," this program is all about offering financial support to make homeownership easier for teachers. It offers funds to assist you with the costs associated with buying a home to attract qualified teachers to areas needing educational professionals.
Regarding eligibility, you'll need to meet typical mortgage providers' credit and income requirements. Mortgage rates in Mississippi can be competitive, and this program may give you that extra advantage to secure a home in these specific shortage areas.
The HAT program doesn't just help you — it contributes to improving education in Mississippi by incentivizing talented teachers to work where they're most needed.
Mortgage Credit Certificate
Mortgage Credit Certificate can reduce your federal income tax liability, freeing up more of your income to qualify for a mortgage. It allows you to claim a tax credit equal to 40% of your annual mortgage interest. That means less money paid to Uncle Sam and more money in your pocket. But there's a cap — you can't receive more than $2,000 in tax credits annually.
You have two options to benefit from this program. You can either revise your W-4 withholding form with your employer, which can boost your take-home pay throughout the year, or claim the tax credit annually when filing your federal income tax return.
Given that current mortgage interest rates in Mississippi fluctuate, this program can offer significant savings over the life of your mortgage. And while the remaining 60% of your mortgage interest doesn't qualify for this credit, it still counts as an itemized tax deduction.
Frequently Asked Questions
If you're searching for a new home in Mississippi, understanding the landscape of mortgage rates is vital. We’ve answered commonly asked questions to provide deeper insights into current mortgage rates in Mississippi.
About Christopher Boston
- FRED Economic Data. "Homeownership Rate for Mississippi." Accessed September 11, 2023.
- FRED Economic Data. "Homeownership Rate in the United States." Accessed September 11, 2023.
- Mississippi Home Corporation. "Home Page." Accessed September 11, 2023.
- Mississippi Home Corporation. "Housing Assistance for Teachers (HAT)." Accessed September 11, 2023.
- Mississippi Home Corporation. "Mortgage Credit Certificate." Accessed September 11, 2023.
- Mississippi Home Corporation. "Mortgage Revenue Bond 7." Accessed September 11, 2023.
- Mississippi Home Corporation. "Smart6." Accessed September 11, 2023.
- Zillow. "Mississippi Home Values." Accessed September 11, 2023.