How Are Mortgage Rates in Pasco Calculated?

When you are shopping for a home, one of the most important elements you need to pay attention to is your mortgage. It’s important to find great mortgage rates in Pasco to ensure you can afford your new home. One of the things that often confuses people the most is how these mortgage rates are calculated.

Federal Interest Rates

First and foremost, the federal government is in charge of setting base interest rates that are used by banks and lenders to determine how much interest they can charge their customers. However, this doesn’t mean you will get the federal interest rate listed. Many lenders add additional percentage points based on a variety of other factors. This is simply the starting point for determining mortgage rates in Pasco.

Credit Score

In addition to using the federal interest rate, lenders will take a close look at your credit score. For instance, if you have late payments or high credit balances, you may find you are offered a much higher interest rate than someone who has a clear credit score and doesn’t have as large of a debt to income ratio as you have. This is because you would be seen as a greater risk than someone who has a much higher credit score than you.


For those who have a lower credit score and are looking to lower their mortgage payments and mortgage rates in Pasco, points could be the solution they need. Basically, these points are payments toward the interest you will owe later. This means you will be able to lower your payments. However, this option isn’t the right choice for everyone, which is why it’s important to talk to your lender about the potential financial repercussions before making this type of decision.

If you’re looking for the best mortgage rates in Pasco, visit the Hapo Community Credit Union to learn more.

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