There are five distinct mortgage programs available in Indiana. All five of the following programs qualify for FHA or VA mortgage insurance.
- Fixed Rate Mortgage
- Standard Adjustable Rate Mortgage
- Special Needs or Hybrid Adjustable Mortgage
- Growing Equity Mortgage Program
- Graduated Mortgage
A fixed rate mortgage will carry the same payment and interest rate throughout the term of the loan. Adjustable rate mortgages have a low introductory rate in the beginning of the loan. After this period the interest rates increase. Hybrid ARM’s have extended low interest periods. Jumbo loans are allowed in the state of Indiana but are used very rarely because the housing market does not need such high mortgages in the state. USDA rural home loans are available in some areas of the state. Because Indiana has suffered more foreclosures in the housing crisis than many other states, qualifications for mortgages are very stringent.
Indiana Mortgage Rates
Mortgage rates in Indiana are very low in comparison to other Mid West states. They are below the national median average. Housing prices are very low in the state, especially around the former industrial areas. Because home prices are way below median value, the risk on mortgages does not require high interest rates. Interest rates will also be affected by credit score and employment as well as the amount that is put down on the home. FHA or VA insurance will help to lower interest rates. Loan to value ratio as well as the applicant’s debt to credit ratio will play a part in the mortgage rates. Some lenders will accept bad credit loan applications, but these applicants should be prepared to pay much higher mortgage rates.
Indiana Refinance Rates
Refinance Rates in Indiana are lower than the national average. However, credit requirements are very strict in Indiana to qualify for a refinancing of your loan. You will need to undergo all the requirements set forth for an original mortgage as well as have the property evaluated and appraised. Closing and other associated costs may make a refinance very expensive in Indiana.
Indiana Mortgage Brokers And Lenders
There is a large variety of lenders and brokers in the state of Indiana that offer mortgages. As an added bonus, Indiana has many small, local banks that issue loans. These community style lenders do not have the same restrictions as corporate banks, allowing people to more easily qualify for loans. Internet, credit union, corporate banks and private finance companies can all issue loans in the state. Lenders are allowed to offer special deals or incentives without penalty. Many lenders have special programs designed to attract a specific type of borrower, such as a first time buyer.