Common questions about rates, answered by Mike Swaleh.
What determines the rate I get?
Your credit profile, down payment or equity, occupancy, property type, loan purpose, loan amount, term, and the broader market. Two people applying on the same day can get different numbers for that reason, which is exactly why an honest rate cannot be quoted without a file. Mike can give you real numbers once Mike knows your situation.
Will rates come down next year?
I cannot forecast rates, and I would be doing you a disservice if I tried. What I can tell you is that the decision usually turns on your own situation rather than on a prediction. Mike can talk through what makes sense for you either way.
What is the difference between rate and APR?
The interest rate is the cost of borrowing the money. The APR folds certain financing costs into a single annualized figure so loans can be compared on a like-for-like basis, which is why it is usually higher. APR comparisons get less reliable across different loan types or when you will not hold the loan for its full term.
What are points and should I buy them?
Points are an optional upfront charge that buys a lower rate for the life of the loan. Whether they are worth it comes down almost entirely to how long you will actually keep the loan – there is a break-even point, and if you sell or refinance before it, you lose. Mike can run the break-even on your specific numbers.
What is a 2-1 buydown?
A temporary buydown reduces your payment for the first year or two using money held in escrow, often contributed by the seller. The important part: your actual note rate never changed, and the payment steps up to the full amount when the buydown period ends. It can be a genuinely useful tool as long as you are planning for that step-up.
What is a rate lock?
A rate lock fixes your rate for a set number of days, commonly somewhere between fifteen and sixty. Locks can expire, extensions can cost money, and some lenders offer a float-down under defined conditions. When to lock is a judgement call about your own timeline, and Mike will walk through it with you.
Should I take a fixed rate or an ARM?
A fixed rate never changes. An ARM is fixed for an initial period, commonly five, seven or ten years, then adjusts on a schedule within caps. An ARM can make sense when your holding period is genuinely short and you have a concrete plan; fixed is the right default for most people who intend to stay. Which fits you is a conversation with Mike.
Should I take a 15-year or 30-year loan?
A shorter term means a higher monthly payment and substantially less total interest. A thirty-year term keeps the payment lower and more flexible – and you can always pay extra voluntarily, which gets you part of the way without committing to the higher payment. Which is right depends on your cash flow and priorities.
Does Fairway have better rates than other lenders?
I am not able to make comparisons to other lenders. What I can tell you is that Mike will give you your terms in writing – on a purchase or refinance that is a Loan Estimate, a standardized document specifically designed so you can compare offers on identical terms – which is a better basis for a decision than anything I could claim.
Can I get a rate quote by email?
A real quote is built on your own situation rather than a headline number, and that is exactly the kind of thing the real Mike does. Asking for one is a step you take yourself: book a time, call the office or send an email, whichever suits. This chat collects nothing and passes nothing on.
Mike Swaleh, Area Manager · NMLS #739145 · Fairway Independent Mortgage Corporation, NMLS Entity ID #2289
436 Lincoln Boulevard, Suite 105, Lincoln, CA 95648 · mswaleh@fairwaymc.com · Licensed in AZ, CA, CO, FL, GA, IL, KY, MO, NV, NC, OR, SC, TN, TX, WA
This information is not intended to be an indication of loan qualification, loan approval or a commitment to lend. Other limitations may apply. This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates, and programs are subject to change without prior notice. All products are subject to credit and property approval. Not all products are available in all states or for all dollar amounts. Fairway is not affiliated with any government agencies. Licensed by the Department of Financial Protection and Innovation under the California Residential Mortgage Lending Act, License No 41DBO-78367.
Equal Housing Opportunity. Verify licensing at nmlsconsumeraccess.org
