As is the case when buying a home anywhere, when buying a home in Sun City Festival you’ll likely take out a mortgage to finance this significant purchase – even if you have plenty of cash on hand from the sale of your previous home. You might be wondering why this is the case. Well a mortgage lets you finance your retirement from the sale proceeds rather than tying it up in a home.
According to Bankrate, interest rates in the Buckeye, Arizona area are still affordable as of the end of August 2013. However, it should be noted that these rates do fluctuate according to the term of the loan. To demonstrate a bit more specifically your mortgage options for purchasing real estate in Sun City Festival, I offer the following examples. These numbers are based on a home sale price of $110,000 with 20 percent down, no points, and an excellent credit score of 740 or higher.
Your most traditional option is a 30-year fixed mortgage, which offers a constant payment over the life of the loan. This can sometimes be more difficult to qualify for because it usually comes with the highest interest rate.
- The annual percentage rate (APR) in the Sun City Festival area ranges from 4.23 to 4.85 percent, resulting in a monthly payment ranging from $533 to $574
- Compare this to the national average APR of 3.87 percent for the same term
For those who’d prefer to own your home faster, you might want to consider a 15-year term with an APR of 3.38 to 4.02 percent.
- The shorter term means higher monthly payments ranging between $766 and $800, but also means a lower overall cost by the end of the loan
- The US average for this loan term is 3.62 percent
Another option includes adjustable rate mortgages. This type of mortgage typically starts with a lower teaser rate for a specified amount of time before increasing to match prevailing rates.
- With a 5/1 loan, the rate remains fixed for 5 years, with a range of 3 to 3.33 percent
- Payments for this mortgage go from $449 to $517
- The US APR is 3.53 percent
To learn more about mortgage rates and buying a home in Sun City Festival, please contact me and I can guide you along the way as well as connect you with a reputable local mortgage lender.
Leave a Reply