A home is an asset for reasons that go far beyond the shelter it provides. It is an investment, one that you can take advantage of in numerous ways. And with mortgage, refinancing, and home equity line of credit rates at historic lows, those eager to borrow are ready to pounce. Before you do, make sure you have a bank who is on your side.
Using a variety of factors, Reuters reported in November this year that current average mortgage rates remain at historic lows in the U.S., at around 4.01 percent (for a 30—year fixed loan). In Indiana, that number was 3.96 percent. Of course, a buyer’s mortgage rate also depends on individual credit history, loan amount, and down payment, but even so, the Census Bureau is reporting that more than 63 percent of homeowners are paying interest rates between 3-7.84 percent.
Horizon Bank mortgage loan advisors know these are ripe times for both first-time and seasoned home buyers, and for those who want to bank on the equity of their homes for other projects. But they also advise that an informed borrower is the best borrower.
A good place to start if you’re interested in a new mortgage, a refinance, or a home equity line of credit, is Horizon Bank’s website, specifically the section on loans. There you can find great base-line information such as a rate check form, and mortgage calculators for 15-year, 30-year, fixed, and arm loans. They even have an entire section on sensible advice before you borrow, including tips to save for the house of your dreams, the difference between a home equity term and a line of credit loan, and good questions to ask before refinancing.
Nothing, though, replaces a good person-to-person conversation with a qualified Horizon Bank loan officer.
“We employ people from around the Region, and all of our home loans are underwritten by people in the Region,” said Mark Ritzi, Horizon Bank’s Vice President and Market President of Porter County. “We’re a homegrown neighborhood bank, based right in Michigan City.”
Horizon Bank is motivated to help new home buyers capture the value of low mortgage rates, so much so that they’re guaranteeing that new home purchase loans will close within 30 business days or the buyer receives $500. (Certain conditions apply. Go here for details). You can even apply for a new mortgage online here.
For those who already own homes but want to pull equity out of them, exceptional service and sensible advice are part of the Horizon Bank promise as well.
A home equity line of credit (HELOC) works like a credit card, except the available balance is relative to your home equity. It is a flexible option when compared to a mortgage, a fund that can be pulled from over time. While mortgages have a fixed interest rate, they also have fixed payments. A HELOC has a variable interest rate, but the only required monthly payments are against the interest.
The flexible nature of a HELOC means that homeowners can use it as a resource to accomplish many different goals.
“The intention isn’t really to keep a debt for a long period of time,” Ritzi said. “As you pay it down, you have room to buy, consolidate, or invest. Some people use HELOCs to pick up investment properties or old cars that they find. It’s just like cash on the short term.”
Horizon’s HELOC interest rates start at prime, which makes them one of the best options for short-term credit on larger projects. Home improvement, new cars, and college tuition are all common reasons people choose a HELOC.
“It’s better than a credit card and can be used for a multitude of things,” Ritzi said. “You’ve got credit cards sitting at a 20 percent interest rate compared to around five percent at prime on a HELOC.”
To learn more about how to capture the value of historic low interest rates for mortgages, HELOCs, or refinance loans with a trusted local bank, visit www.horizonbank.com.