If you live in Maine and you’re thinking of refinancing your mortgage, here’s a look at the options that are available to you:
Current 30-year fixed mortgage refinance rates are averaging: 7.71%
The current average rate for a 15-year fixed mortgage refinance is: 7.12%
See whether refinancing makes sense for you using our mortgage refinance calculator.Mainers are likely happy to hear that this year’s mortgage rate forecast has rates trending downward. After rising to a staggering 7.79% in October 2023, rates began to fall. Fortunately for borrowers, they dropped by more than a full percentage point at the end of the year — and our 2024 housing market predictions anticipate that this movement will continue. That change can mainly be attributed to a series of projected rate cuts by the Federal Reserve during the latter half of the year.
Borrowers should know that multiple variables determine mortgage rates. Current market conditions, for example, will have a huge impact. Still, there are some steps you can take on your own to secure the best mortgage rate possible, including:
When should I lock in my mortgage rate?After you’ve been approved for your home loan, be sure to ask your lender about a mortgage rate lock. This important step ensures your rate will stay the same until you make it to the closing table.
It can be difficult to shoulder the upfront costs of buying a home. However, fortunately for would-be homebuyers in the “Pine Tree State,” MaineHousing offers a handful of programs aimed at making homeownership more accessible for its residents. Here are four options worth considering:
Available to Maine’s first-time homebuyers, the First Home Loan Program combines low-interest, fixed-rate home loans with a variety of initiatives meant to make buying a home more affordable. These initiatives include a down payment assistance (DPA) program, unemployment protection and financing options for home improvements.
Borrowers must:
Be a first-time homebuyer (may not have owned a home within the last three years)
Meet certain income and purchase price limits
Ensure your mortgage payment doesn’t exceed 30% to 33% of your total monthly income
Meant specifically for applicants whose parents or guardians didn’t own a home while they were growing up, MaineHousing’s First Generation Program combines similar benefits to its First Home Loan program with financial literacy and homebuyer education classes to encourage long-term homeownership. This program also offers qualified borrowers access to up to $10,000 in down payment assistance funds and a 1.00% discount on their mortgage rate.
Borrowers must:
Have parents/guardians who may not have owned a home or have been in foster care
Contribute at least 1% of the down payment from their own funds
Meet certain income and purchase price limits
MaineHousing offers two home loan programs aimed at celebrating the state’s veterans and active-duty service members. Salute ME offers qualified first-time homebuyers a 0.50% discount on the First Home Loan Program’s affordable mortgage rates. Meanwhile, Salute Home Again waives Salute ME’s first-time homebuyer requirement and opens up the program to military members who have owned a home before.
Borrowers must:
Be/have been an active-duty service member, veteran or other qualified military personnel
This initiative combines a MaineHousing mortgage loan with a $35,000 grant to help residents replace their older mobile homes with a newer, Energy Star®-certified manufactured home on the same land as the existing structure. The home must be used as a permanent residence and grant recipients must live in the home for at least 10 years.
Borrowers must:
Replace their manufactured home with an Energy Star®-certified manufactured home that is purchased through a licensed Maine retailer
Have a manufactured home that is anchored to a permanent foundation and connected to utilities
Meet income and purchase price limits
→ Maine conventional loans: Borrowers who have higher credit scores may want to consider choosing a conventional loan. They’re typically the most sought-after mortgage loans because they adhere to the minimum qualifying requirements set by Fannie Mae and Freddie Mac.
→ Maine FHA loans: Meanwhile, FHA qualifying requirements are slightly more flexible than the eligibility criteria for conventional loans. Borrowers with credit scores as low as 500 can qualify, as long as they’re able to make a 10% down payment. However, if you have at least a 580 credit score, you’re able to make just a 3.5% down payment.
→ Maine VA loans: Maine’s qualified military borrowers should likely focus on applying for a VA loan. These loans have many unique benefits, including the fact that they don’t require a down payment or mortgage insurance. That said, individual lenders may still set some of their own qualifying criteria.
→ Maine streamline refinances: In some cases, you can replace your home loan without needing to jump through all the hoops associated with a traditional refinance. For example, the FHA streamline refinance program and the VA interest rate reduction refinance loan (IRRRL) program both allow eligible homeowners to refinance their existing government-backed mortgages, while also benefiting from a streamlined application process.
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