Current New Mexico Mortgage and Refinance Rates

If you’re looking to get better offers from mortgage lenders and save money on your loan, here are a few steps you can take to make it happen:

1. Work on your credit. Credit scores play a huge role in how your mortgage rate is determined, so you’ll want to review your credit reports and see where there’s room for improvement. If your scores are 780 or higher, you’ll typically qualify for the best rates available — but for borrowers with low scores, any gain in points can help.
2. Downsize. Home sale prices nearly doubled in New Mexico from 2013 to 2023, according to the Greater Albuquerque Association of Realtors. One way to bring down your rates is to borrow less money, which takes some planning in this market. To reduce your loan amount, consider buying a smaller and lower-priced home or skipping on pricey amenities.
3. Put more money down. With a bigger down payment, you can borrow less, qualify for lower rates and even save money on private mortgage insurance (PMI). While you may need extra time to save more cash, you can also boost your down payment with gift funds from family or with the help of a local down payment assistance program.
4. Comparison shop. You can find the best rates available by shopping around and comparing preapproval offers from multiple lenders, including credit unions. With your quotes in hand, you can use one lender’s offer to negotiate better rates with another.
5. Homebuyer programs. Be sure to include New Mexico’s homebuyer programs in your loan search, since there may be a program that offers you a low rate with more flexible qualification requirements than you get from other lenders. An FHA loan or VA loan can be a great option for qualified borrowers, too.
6. Apply with a cosigner. If your finances or credit aren’t in the right shape, consider applying with a cosigner. Being a cosigner is a serious legal commitment, but if you have someone who’s willing to do it, lenders will be more likely to offer you better loan terms.

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→ New Mexico conventional loans. Conventional loans are the most common type of mortgages offered through banks and credit unions. Each lender has its own requirements to determine who qualifies but you’ll often need a minimum 620 score and at least a 3% down payment to be eligible for one of these loans.

→ New Mexico FHA loans. It’s easier for many buyers with poor credit to qualify for FHA loans than for conventional loans. If your credit scores are between 500 and 579, you’d need a 10% down payment. But with scores at 580 or higher, the down payment requirement drops to 3.5%.

→ New Mexico VA loans. If you’re a service member or veteran you might prefer to go through the VA for your mortgage. You can qualify for a VA loan with no down payment or mortgage insurance on the loan, and may even be able to qualify with credit scores as low as 500.

→ New Mexico USDA loans. For low- and very-low-income borrowers, the USDA’s Single Family Housing Direct home loan program can help you buy a home in rural New Mexico. There’s no down payment required to qualify for this USDA loan program and these loans have an ultra-low, 4.5% interest rate.

→ New Mexico streamline refinances. Streamline refinancing lets you refinance your mortgage with less paperwork and underwriting than other refinance loans. If you have an FHA loan, you might be eligible for an FHA streamline refinance. Meanwhile, VA loan borrowers can take advantage of a VA interest rate reduction refinance loan (IRRRL).

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