Guide to Refinance, Mortgage,
& Home Equity Loans in
Baton Rouge, Louisiana (LA)
Baton Rouge, LA is an amazing place to live. With an average home price of only $139,000, and an amazing background unique to Louisiana, it is not hard to see why over two hundred thousand people call it home. Warm winters and an unmatched cultural diversity attract many new homeowners to the area. Whether you have already made your home in Baton Rouge, LA, or you are looking to, you may be looking at mortgages and refinance loans.
One of the first things you must do as you search for a mortgage, refinance, or home equity loan in Baton Rouge, LA, is select the right loan for you. As you shop for lenders, they will ask you what kinds of loans you are interested in. There are several loans that work quite well for either a mortgage or a refinance.
- Fixed rate loans: This type of loan has one interest rate throughout its term. Over the course of the loan, you will make one standard payment each month. A variation on this kind of loan is a biweekly mortgage. While this is not only available as a fixed rate product, it is most popular as one. Instead of making only one payment per month, you will make one payment every two weeks. The benefit to this type of loan is that you can pay off a thirty-year fixed rate mortgage in just nineteen years.
- Adjustable rate loans: Adjustable rate loans are also possible if you are looking to refinance or get a first mortgage in Baton Rouge, LA. These kinds of loans start with a lower interest rate than you might find with a fixed rate product. However, as the term of the loan continues, that interest rate eventually expires. According to the adjustment interval set by your lender, the loan’s rate will change with the market, your lender’s chosen index, and any payment caps your lender has put on your loan. The benefit of these types of loans, though, is that the initial interest rate is very low, so if you need low starting payments or you plan to stay in the home only a few years, this might be the right loan product for you.
- Interest only loans: One variation on adjustable rate loans is interest only loans. With this type of loan, you will pay only the interest payment, not the principal payment, for the first ten years of the life of the loan. After the ten years are up, you will be expected to make both interest and principal payments for the rest of the loan’s term. These kinds of loans can be great for individuals who expect to see a rise in income over the course of the next ten years.
- Jumbo mortgages: If you are looking at a larger home, you may also need to look into jumbo mortgages. These types of loans do not conform to industry standards, and thus they come with a much higher interest rate. However, if you want a property that is quite a bit more expensive than most, this might be the right mortgage or refinance loan for you.
- Home equity loans: If you are just looking to work with the equity in your home, you might want to consider a home equity loan or line of credit instead of a traditional refinance loan. This will allow you to tap into the value of your home without displacing your initial mortgage.
When you have chosen the right loan, it is time to choose the right lender. When most people shop for lenders, they ask only about the interest rates on the loan products they are interested in. In addition to getting the interest rate for your loan in writing from a potential lender, you should also get the loan’s costs in writing. For example, if one lender offers a 5.2% interest rate on the loan product you want, but his loan costs are much higher than you expected, checking a second lender’s closing costs is a practical solution, even if his interest rate is 6%.
If you are looking for a refinance, mortgage, or home equity loan in Baton Rouge, LA, take a moment to fill out the form below. A qualified lender will contact you promptly to discuss your individual needs.
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