Mortgage Rates South Carolina: Navigating The Competitive Housing Market
(insert personalized rate tool here)
South Carolina is a seller’s market, meaning that demands for homes far outweigh its supply. This means you’re likely to face stiff competition if you’re looking to call the Palmetto State home. However, knowing the local mortgage and refinance rates can boost your odds of finding great housing deals.
This guide covers everything you need to know about mortgage rates in South Carolina. Read on for insider access to the most current mortgage and refinance rates in the state, as well as a guide to South Carolina’s homebuyer assistance programs.
Home Loan Options In South Carolina
You have three loan types to choose from when purchasing a home in South Carolina. Each type has its unique features and caters to different needs, so you should assess your financial situation and choose the loan product that best suits your requirements.
Most mortgages that aren’t backed by a government body are considered conventional home loans. They are usually provided by banks and private mortgage lenders, subject to loan amount limits defined by the Federal Housing Finance Agency (FHFA). The FHFA conforming loan limit for all of South Carolina is set at $548,250.
Conventional mortgages are further split into three types, each with its unique features and benefits:
Fixed-rate mortgages feature a static interest rate immune to market fluctuations. This means your monthly payment amount will be stable for the loan’s entire life. Thanks to the stability and predictability, fixed-rate loans are great for new homebuyers. However, a fixed loan’s interest rate is usually higher than other loan types.
People typically take 30-year fixed loans because they offer the lowest monthly payments. If you’re looking for lower rates, you can pick 15-year or 20-year loan terms instead.
Adjustable-Rate Mortgage (ARM)
Adjustable-rate mortgages have interest rates that change annually. These rate adjustments are based on market index movements.
To provide some stability, ARMs feature an introductory period with fixed mortgage interest rates. Your introductory period lasts anywhere between 3 and 10 years. The length is usually stated in the loan’s name – for instance, a 7/1 ARM features a 7-year introductory period.
Since your introductory rates are lower, ARMs are good for short-term savings. However, the adjustable phase means your rates and monthly payments could be unpredictable after the introductory period.
You can choose a jumbo mortgage with increased loan amounts if you’re looking to buy a more expensive home. As a tradeoff, jumbo rates tend to be higher than other loans and have stricter qualification requirements.
Government-Backed Loan Programs
The United States federal government backs three loan products aimed at demographics like low-income borrowers and military veterans. The three loan types are:
FHA loan: Designed to provide affordable housing for borrowers without good credit, FHA loans feature lenient qualification requirements. However, you’re required to pay mortgage insurance premiums for the entire loan’s life. FHA loans also have a lower loan amount limit compared to conventional loans.
VA loan: VA loans are aimed at active and former military members. You can get a zero-down loan if you pay a VA funding fee worth 2.3% of the mortgage, but you can drive your funding fees down by putting more money down.
USDA loan: These U.S. Department of Agriculture-sponsored loans are designed to boost the rural homeownership rate, which is why they have strict area requirements. On the upside, these loans have zero down payment requirements and lower mortgage insurance fees.
A mortgage refinance provides you with a loan to pay off your old mortgage balance. This is usually done to accomplish one of two things:
Change your loan details: Rate and term refinances allow you to alter your loan type and length. You can shorten or lengthen your mortgage period as well as convert a fixed-rate loan into an ARM or vice versa.
Liquidate home equity: Cash-out refinancing provides you with a loan that’s larger than your current loan balance. Any money left after paying off your mortgage can be used for other needs.
Compare Mortgage Rates In South Carolina
Historically, South Carolina mortgage rates have adhered closely to the national average mortgage rates. Find out the latest mortgage rates in the state using the table below. All listed mortgage and refinance rates are taken from America’s top lenders.
Today’s Mortgage Rates In South Carolina
(insert rate table here)
The rates above may change without prior notice. Your actual rates may vary depending on your financial circumstances and other factors.
Input your financial details into the rate calculator above for a customized look at your South Dakota mortgage rates.
First-Time Homebuyer Programs In South Carolina
As alternatives to federal programs, you can look into state homebuyer assistance programs run by the South Carolina Housing Finance and Development Authority (SC Housing). You can choose between two primary homebuyer assistance programs:
SC Housing Homebuyer Program
SC’s primary mortgage assistance program helps new homebuyers with 30-year mortgages at a relatively low cost. Here are the qualification requirements:
Provide a down payment worth 3-3.5% of the loan
Fulfill the minimum credit score requirement
Meet the area’s income limits
Purchase a primary residence in South Carolina
Meet purchase price limits on your single-family home
SC Housing Forgivable Down Payment Assistance
SC Housing borrowers can take part in one of two down payment assistance (DPA) programs in the form of a forgivable second mortgage. Depending on your income, your loan can be forgiven in either 10 or 20 years.
The two DPA programs offered are:
SC Housing DPA: The state’s standard DPA program features a $7,000 forgivable loan that requires participation in a homebuyer education course.
SC Housing CountyFirst: The CountyFirst program offers $8,000 in down payment and closing cost assistance for homes in one of 20 eligible South Carolina counties.
Palmetto Home Advantage
The Palmetto Home Advantage loan is available for first-time and repeat homebuyers. This program features competitively-rated FHA, VA, USDA, and conventional loans. Participants also receive a reduced mortgage insurance rate and up to 5% of the loan in DPA.
Palmetto Heroes Program
This program provides essential workers, first responders, and medical personnel with low-rate fixed loans that come with up to $12,000 in down payment assistance. This loan has the same requirements as the SC Housing Homebuyer Program and is open to everyone working in eligible professions.
Buying A Home In South Carolina
Navigating SC’s real estate market can be tricky and any mistakes can end up costing you thousands. To prevent these costly missteps, follow our six simple steps to landing your dream South Carolina home!
Step 1: Get Pre-Approved
First, start a mortgage process with a lender. Once you pass their credit checks, you’ll receive a pre-approval letter that contains key loan details like its mortgage rate and maximum amount. This letter also serves as a budget guide as well as a sign of financial readiness to buy property.
Step 2: Find A Real Estate Agent
Experienced real estate agents can help you navigate the market. They help you secure the best home deals and answer your questions about their neighborhood. When interviewing agents, pay close attention to their years of experience and review scores.
Step 3: Search For Homes
Begin your house hunt by choosing a neighborhood that fits your lifestyle and budget. Then, search local listings to find the most affordable homes there. If no homes fulfill your needs, consider buying the cheapest home available and use the money you save to pay for home improvements.
Step 4: Put Down An Offer
You’re likely not the only one with eyes on the home. However, you can catch the seller’s eye by offering above the listed property value. Consult with your realtor before making the offer to avoid overpaying.
Step 5: Examine The Home
It’s essential to examine the property before finalizing the home purchase. Hire home inspectors and appraisers to give your new home a thorough examination. If the property is overvalued or suffers from defects, you can renegotiate a deal with the seller.
Step 6: Close The Deal
Prepare the money to pay your closing costs, origination fees, and other expected costs before settling on a closing date. Have your realtor attend the paperwork signing so they can answer any questions you may have before finalizing the deal.
How To Get Better South Carolina Mortgage Rates
Getting the lowest mortgage rate means you’re saving money each month from the reduced interest payments. Since mortgages are a long-term commitment, you may end up saving thousands of dollars over the years.
Follow these top tips to reduce your South Carolina mortgage rate!
Take Shorter Loan Terms
Lenders offer better rates on shorter loans because they bear less risk on them. Taking a shorter loan term also means you’re charged fewer interest expenses, further driving down your total mortgage expenses. However, you should be prepared for more expensive mortgage payments.
Provide More Down Payment
Larger down payments reduce your mortgage balance, meaning you pay less each month. Lenders also offer a lower mortgage rate to people who pay more down since they’re considered less-risky borrowers. Moreover, paying over 20% down allows you to avoid mortgage insurance fees.
Buy Discount Points
Discount points reduce your mortgage rates in exchange for an upfront payment. Each point is usually worth 1% of your mortgage and provides a 0.25% rate reduction. However, discount points only apply to your current mortgage so you should only buy them if you’re not planning to refinance.
Additional Rate Reduction Steps
To complement the three aforementioned tips, you can follow these additional steps to lower your rate:
Compare multiple offers from multiple lenders.
Work with independent mortgage brokers.
Improve your credit score.
In a seller’s market, you need to move fast before losing out on the home of your dreams. Knowledge of the current mortgage rates and the home buying process can help you find the best deals and act fast on them.
If you’re looking for the best mortgage deals in South Carolina, Wesley LLC is here for you. Contact our professional team today for more mortgage resources and advice!