Summary List PlacementTable of Contents: Masthead Sticky
Buying a home in West Virginia
According to Zillow, the typical home value in West Virginia is much lower than the typical value of $272,446 across the US. The typical home value in West Virginia is $113,578, and home values have increased 5.2% over the past year.
West Virginia first-time homebuyer programs
If you get your mortgage from a participating lender, you may be eligible for financial assistance through the West Virginia Housing Development Fund. Choose from one of the following programs:
- Homeownership Program: You may qualify for this program if you’re a first-time homebuyer who meets income and home price requirements. You can receive a loan for $7,500 to $10,000 and use it for down payment/closing cost assistance. You’ll pay a 2% interest rate and repay the money over 15 years.
- Movin’ Up Loan Program: This program is for moderate-income borrowers, and you don’t have to be a first-time homebuyer. Get a loan for $5,000 to $8,000 to put toward a down payment or closing costs. You’ll repay the loan over 15 years at a 2% interest rate.
- Federal Housing Administration mortgage: You can get a down payment of 3.5% with a credit score of at least 580, or get a mortgage with a credit score between 500 and 580 with 10% down using this loan, which is also called an FHA loan.
- United States Department of Agriculture mortgage: These loans, also called USDA loans, can be useful if you are a low-to-moderate income borrower looking to buy a home in a rural or suburban area.
- Veterans Affairs mortgage: These mortgages, also called VA loans, are for active-service military members or veterans, or spouses of members who have died and can provide lower interest rates than conventional mortgages.
Refinancing your mortgage in West Virginia
Mortgage refinance rates are low these days, so it could be a good time to refinance your current mortgage into one with a lower interest rate — especially if the new rate would be significantly lower.
You might end up refinancing with the same lender that gave you your original mortgage, but it’s not always the best idea. A different company could offer you a lower rate the second time around. Shop around for a lender that will offer the best interest rate and charge relatively low fees.
How to get a low interest rate on your mortgage
Here are some tips for landing a good interest rate on your mortgage:
- Save for a down payment. With a conventional loan, you may be able to put down as little as 3%. But the higher your down payment, the lower your rate will likely be. Rates should stay low for a while, so you probably have time to save more.
- Increase your credit score. Many lenders require a minimum credit score of 620 to receive a mortgage. But the higher your score, the better your rate will be. To improve your credit score, be sure to pay all your bills on time. You can also pay down debts or let your credit age.
- Lower your debt-to-income ratio. Your DTI is the amount you pay toward debts each month, divided by your gross monthly income. Most lenders want to see a DTI of 36% or less, but an even lower DTI can result in a better rate. To improve your DTI, pay down debts or figure out whether you can earn more money.
- Choose a federally backed mortgage. If you’re eligible, you might consider a USDA loan (for low-to-moderate-income borrowers buying in a rural area), a VA loan (for military members and veterans), or an FHA loan (not designated for any particular group). These loans typically come with lower interest rates than conventional mortgages. As a bonus, you won’t need a down payment for USDA or VA loans.
Improving your financial situation and choosing the right type of mortgage for your needs can help you get the best interest rate possible.
Historic mortgage rates for West Virginia
By looking at the average mortgage rates in West Virginia since 2010, you can see trends for 30-year fixed mortgages, 15-year fixed mortgages, and 7/1 adjustable mortgages:
Seeing how today’s rates compare to historic West Virginia mortgage rates may help you decide whether you’d be getting a good deal by getting a mortgage or refinancing now.
How 30-year fixed rates work
A 30-year fixed mortgage comes with a higher interest rate than a shorter-term fixed-rate mortgage. The 30-year fixed rates used to be higher than adjustable rates, but 30-year terms have become the better deal recently.
Your monthly payments on a 30-year term will be lower than on a shorter-term mortgage. You’re spreading payments out over a longer period of time, so you’ll pay less each month.
You’ll pay more in interest in the long term with a 30-year term than you would for a 15-year mortgage, because a) the rate is higher, and b) you’ll be paying interest for longer.
How 15-year fixed rates work
The 15-year fixed-rate mortgages are more affordable than 30-year terms in the long run. You’ll pay a lower interest rate on a 15-year term, and you’ll pay off the mortgage in half the time.
Your monthly payments will be higher for a 15-year mortgage than for a 30-year mortgage, though. You’re paying off the same loan principal in a shorter amount of time, so you’ll pay more every month.
How adjustable rates work
An adjustable-rate loan keeps your rate the same for the first few years, then changes it periodically. For example, with a 5/1 ARM, your rate is locked in for the first five years, then it fluctuates once per year.
Although ARM rates are at historic lows right now, fixed-rate mortgages are still better deals in the long run. The 30-year fixed rates are comparable to or lower than ARM rates. It could be in your best interest to lock in a low rate with a fixed-rate mortgage rather than risk an increase later with an ARM.
If you’re considering an ARM, you should still ask your lender about what your individual rates would be if you chose a fixed-rate versus adjustable-rate mortgage.
Mortgage and refinance rates by state
Related Content Module: More Mortgage Coverage