North Carolina Home Mortgage Rates and Costs

In North Carolina, the average 30-year fixed mortgage rate is around 3.75%, which is relatively low compared to other states. This is a significant factor in determining how much house you can afford.

Closing costs for a North Carolina home mortgage typically range from 2% to 5% of the loan amount. This can add up quickly, so it's essential to factor these costs into your overall budget.

The cost of homeowners insurance in North Carolina can vary depending on your location, with coastal areas generally being more expensive due to hurricane risk. On average, homeowners insurance premiums in North Carolina range from $800 to $1,800 per year.

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Mortgage rates are difficult to predict, but most economic experts believe the Federal Reserve will begin cutting rates this fall, which could lead to lower mortgage rates.

However, this can also create a challenge for homebuyers, as lower rates may attract more competition. In some parts of North Carolina, like Charlotte, the typical home receives three offers, while Raleigh homes typically receive two offers and sell in just 19 days.

To get the best mortgage rate, it's essential to strengthen your credit score, determine your budget, and know your mortgage options. You can also compare rates and terms from several lenders to find the best deal.

Here are the steps to find the best mortgage rate in North Carolina:

The current mortgage rates in North Carolina are quite high, with a 30-year fixed mortgage rate of 7.13% as of January 13, 2025.

The good news is that mortgage rates are expected to drop if the Federal Reserve cuts rates this fall, making it a great time to buy a home.

Currently, the median home sale price in North Carolina is up 1.6 percent year-over-year, which may make it a bit more challenging to find a home within budget.

However, available inventory of homes has risen nearly 23 percent year-over-year, giving buyers more options to choose from.

In some parts of the state, like Charlotte, homes are getting multiple offers, with the typical home receiving three offers in July 2024.

This competition can make it tough to secure a home, but it's still a promising sign for buyers.

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Property taxes in North Carolina are relatively low, at around 0.73% of your home's value, making it the 16th-lowest state effective tax rate in the nation.

Homeowners insurance is another important factor to consider, with an average annual cost of $2,941 in North Carolina, according to 2024 data from Insurance.com.

For coastal property owners, additional insurance may be necessary to protect against hurricane damage, with the National Flood Insurance Program offering coverage.

The Fair Access to Insurance Requirements (FAIR) Plan is also available for those who can't qualify for private insurance, providing basic property insurance.

Here's a rough breakdown of the average annual costs to consider when calculating your mortgage payment:

Keep in mind that these costs can add up quickly, so it's essential to factor them into your budget when determining how much house you can afford.

Home buying costs can add up quickly, and it's essential to factor them into your budget. Home inspections, which cost between $225 and $525, are a must-do to get a complete picture of the property's condition.

You'll also need to pay closing costs, which include fees for services like mortgage lender origination fees and county clerk charges. These fees can vary, but they're a necessary part of the home buying process.

In North Carolina, home buyers can expect to pay between $225 and $525 for a home inspection, depending on the size and type of property.

Home inspections are a crucial step in the home buying process, and they can cost between $225 and $525, depending on the size of the home.

You'll likely want to hire a professional to inspect the property, especially if you're planning to make a big financial decision.

Larger homes tend to be at the upper end of this range, while condos and smaller homes are at the lower end.

Optional add-on tests include mold, radon, termite, and infrared, which you can arrange if you want a more comprehensive inspection.

In some cases, a home inspection can help you negotiate the asking price or repairs.

At the time of closing, you'll be required to pay a number of fees for various services, collectively referred to as closing costs.

These fees can include mortgage lender origination fees and county clerk charges, among others.

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To make a strong offer on a house, you need to know how much down payment you can afford. Make offers knowing what you can afford.

The amount of down payment needed varies, but a common rule of thumb is to put down at least 20% of the purchase price. This can help you avoid paying private mortgage insurance.

Having a larger down payment can give you more negotiating power when making an offer, but it's not always necessary. Some mortgage options allow for lower down payments, such as 3% or 5%.

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In North Carolina, you've got several mortgage options to choose from. Over 82,000 homes have been purchased in the state in 2024 alone.

To qualify for a conventional mortgage, you'll need a minimum credit score of 620 and a debt-to-income (DTI) ratio of no more than 45 percent. If you make a down payment of less than 20 percent, you'll need to pay private mortgage insurance (PMI).

You can also consider FHA loans, which allow for a credit score as low as 580 with a down payment of at least 3.5 percent. This can be a great option if your credit history disqualifies you from a conventional mortgage.

Here are some key differences between the mortgage options:

Conforming loans are a type of mortgage option that's widely available in North Carolina. The conforming loan limit across the state is $766,550, regardless of the county you're considering.

If you're looking to buy a high-priced luxury property, you'll need to compare lenders that offer jumbo loans. To qualify for a jumbo loan, you'll want to have a credit score of at least 680 and a down payment of at least 10 percent.

Conforming loans have some specific requirements. For example, you'll need a minimum credit score of 680 to qualify for a jumbo loan, and a debt-to-income ratio of no more than 45 percent.

Here are some key facts about conforming loans:

By understanding the specifics of conforming loans, you can make an informed decision about which mortgage option is right for you.

Jumbo loans are available for those who need to borrow more than the conforming loan limit of $766,550 in North Carolina.

To qualify for a jumbo loan, you'll want to get your credit in the best shape possible, with a minimum credit score of 680.

A jumbo loan requires a down payment of at least 10 percent, which can be a challenge for some buyers.

You can borrow up to $940,000 with a jumbo loan, but be aware that the rates and monthly payments will be based on this loan amount and a down payment of at least 25%.

The funding fee for a VA loan is a consideration, ranging from 1.25 percent to 2.15 percent for first use, but it doesn't require a down payment or mortgage insurance.

Here's a quick summary of the loan types mentioned:

First-time homebuyers in North Carolina have access to affordable loan options through the North Carolina Housing Finance Agency.

The North Carolina Home Advantage Program offers fixed-rate loans with down payment assistance of up to 5% of the loan amount, which doesn't need to be repaid if the homeowner stays in the home long enough.

To qualify for the NC Home Advantage Mortgage and down payment assistance, borrowers must have a credit score of at least 640 and an income of no more than $140,000.

This program can be used for single-family homes, duplexes, condos, or townhomes and can be coupled with forgivable down payment assistance up to $15,000.

The NC Home Advantage Tax Credit is another option, allowing borrowers to claim a federal tax credit for 30 percent of the mortgage interest every year, up to $2,000.

Here are some key details about North Carolina's first-time homebuyer programs:

To get an accurate picture of your mortgage payment, you'll want to calculate costs beyond just principal and interest. This includes property taxes, homeowners insurance, and other fees.

In North Carolina, property taxes are one of the first things to consider, with a state effective tax rate of 0.73% of your home value. This translates to about $1,326 per year on a $350,000 home.

Homeowners insurance is another significant cost, with an average annual premium of $2,941 in North Carolina. If you're considering coastal property, you'll want to factor in additional insurance costs.

You can also expect to pay monthly homeowner association fees and mortgage insurance. The calculator lets you fine-tune your payment by entering these costs.

Here's a breakdown of the costs you'll need to consider:

When considering a home mortgage in North Carolina, it's essential to factor in the state's relatively low median home price of around $270,000.

The state's low median home price can lead to lower mortgage payments, making homeownership more accessible to first-time buyers.

North Carolina's home mortgage rates are influenced by the federal funds rate, which can impact the overall cost of borrowing.

For every 1% increase in the federal funds rate, the average North Carolina home mortgage rate can increase by around $50 per month, affecting homeowners' budgets.

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The mortgage process in North Carolina can be complex, but it's essential to understand the basics before applying for a home loan.

You'll need to check your credit score, which can affect your interest rate and loan terms.

A good credit score can save you thousands of dollars in interest over the life of the loan.

To get started, gather financial documents, including pay stubs, bank statements, and tax returns.

You'll also need to choose between a fixed-rate and adjustable-rate mortgage, with fixed-rate mortgages offering more stability but potentially higher interest rates.

The lender will review your application and order an appraisal to determine the value of the property.

In North Carolina, you can expect to pay closing costs ranging from 2% to 5% of the loan amount.

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North Carolina is the 20th most affordable state in the country, making it a relatively affordable place to take out a mortgage.

Home values in North Carolina rose by 8.6% last year, which is a significant increase.

The state's affordability and growing economy make it an attractive location for companies looking to diversify their workforce, including tech companies.

The Research Triangle and the Outer Banks are just a couple of the many reasons why people are moving to North Carolina.

You can lock a mortgage rate for typically 30 to 60 days. This lock period is a standard timeframe, but it can vary depending on your lender.

If the rate lock expires, you're no longer guaranteed the locked-in rate unless your lender agrees to extend it. This is an important consideration when planning your mortgage process.

You'll want to review your loan details and ensure you're prepared for any changes during the lock period. This might include keeping an eye on your credit score, loan amount, debt-to-income ratio, or appraisal value.

A locked rate can give you financial certainty, but it's essential to understand the lock period and any potential implications.

A mortgage is a loan from a lender to help you buy a home. The loan amount, also known as the principal, is the amount you borrow and each mortgage payment reduces the principal you owe.

Interest rates are how much the lender charges you to lend you the money, expressed as an annual percentage. A lower interest rate gives you a smaller monthly payment.

The loan term, or the number of years it will take to pay off the mortgage, can affect your monthly payment and total interest paid. A longer term gives you a lower monthly payment, but you pay more total interest.

Your first mortgage payment is due on the start date, and you'll pay about one-twelfth of your annual property tax bill with each mortgage payment.

You'll also pay one-twelfth of your annual homeowners insurance premium each month, and the servicer will pay the bill when it's due.

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If you belong to a homeowners association, you may pay monthly HOA fees, which are typically billed directly and not added to the monthly mortgage payment.

If your down payment is less than 20% of the home's purchase price, you'll likely pay private mortgage insurance to protect the lender in case you default on the mortgage.

Here's a quick breakdown of some key mortgage terms:

To compare mortgage offers, you'll want to start by determining the right type of mortgage for your situation. This involves researching and deciding what type of mortgage might be best for you, given your finances and your short- and long-term goals.

You'll also need to gather necessary documentation to provide to lenders, including paperwork that verifies your income, assets, debts, and employment.

To easily compare mortgage offers, use Bankrate's mortgage rate table, which allows you to plug in general information about your finances and location to receive tailored offers. Be sure to consider APRs, lender fees, and closing costs to ensure you're making accurate comparisons and maximizing your savings potential.

Here are some key factors to consider when comparing offers:

You can negotiate mortgage rates, but it requires getting quotes from multiple lenders and having good credit qualifications. This can potentially save you money in the long run.

Buying mortgage points is another way to get a lower rate, but it comes with a cost - one point is equal to about 1% of your total loan amount, so on a $250,000 loan, one point would cost you about $2,500.

Getting quotes from multiple lenders can give you the upper hand in negotiations, so don't be afraid to shop around.

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Comparing mortgage offers is crucial to get the most competitive rate and mortgage terms. Even a 0.1 difference in an interest rate can save thousands of dollars over the life of the loan.

To compare mortgage offers, you need to determine the right type of mortgage for your finances and goals. Research and decide what type of mortgage might be best for you.

Gather necessary documentation to provide to lenders, which includes verifying your income, assets, debts, and employment. This paperwork is required for lenders to give you accurate quotes.

You can compare mortgage offers online using Bankrate's mortgage rate table, which filters allow you to plug in general information about your finances and location to receive tailored offers. Our rate table filters allow you to plug in general information about your finances and location.

When comparing offers, consider APRs, lender fees, and closing costs to ensure you're making accurate comparisons and maximizing your savings potential. Be sure to consider APRs, lender fees, and closing costs.

A 0.1 difference in an interest rate can save thousands of dollars over the life of the loan. This is why comparing mortgage offers is so important.

Here are the 3 easy steps to compare mortgage offers on Bankrate: