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Compare mortgage rates in Idaho.
Key Points
• Mortgage rates in Idaho have seen significant fluctuations, peaking at 7.96% in 2000 and dropping to 5.78% by 2003, with rates staying below historical highs in recent years.
• Rates are influenced by economic factors like the federal funds rate, inflation, and unemployment, along with consumer factors such as credit score and down payment.
• Fixed Rate Mortgages, Adjustable Rate Mortgages, FHA Loans, VA Loans, USDA Loans, and Jumbo Loans are various mortgage options available in Idaho.
• To secure a competitive mortgage rate in Idaho, one should pay off high-interest debt, save for a larger down payment, check credit reports for errors, and compare rates from multiple lenders.
• Closing costs in Idaho, ranging from 3% to 6% of the purchase price, cover fees such as appraisal, attorney costs, and title insurance.
Simply put, your mortgage interest rate is the money you pay the bank in exchange for lending you the amount you need to buy a home. Even when interest rates are low, the cost can really add up over time. That’s why it’s important for Idaho homebuyers to set themselves up for the lowest mortgage rate possible.
We’ll walk you through the following:
• Where mortgage rates come from
• How interest rates affect home affordability
• Economic and consumer factors influencing rates
• Type of mortgages
• Mortgage rate trends in Idaho
• Popular places to get a mortgage in Idaho
• Ways to secure a competitive mortgage interest rate
• Idaho homebuyer assistance programs
• Refinancing options
• Closing costs and fees in Idaho
Introduction to Mortgage Rates
Mortgage rates are calculated using a complex combination of factors that include the state of the economy and the borrower’s financial status. State interest rates generally follow national trends, but there can be variations due to local economic conditions and housing market dynamics. Idaho’s mortgage rates, for instance, are influenced by the state’s job market, cost of living, and housing supply.
Where Do Mortgage Rates Come From?
The Federal Reserve, aka the Fed, sets the short-term interest rates that banks use. Although home loan rates aren’t directly tied to Fed rates, they follow the same economic trends. So when the Fed’s interest rate is high, chances are mortgage rates will be too.
Other mortgage rate influencers include the bond market, inflation, and the unemployment rate. We’ll get into those more below.
How Interest Rates Affect Home Affordability
Mortgage rates have a bigger impact on home affordability than you may realize. Consider the national median home price of $412,300 for Q2 2024. With a 30-year fixed mortgage at 3.00%, the monthly payment is approximately $1,390. However, if the interest rate increases to 6.00%, the monthly payment jumps to $1,977. Such an increase — more than 40% — can affect affordability for many buyers.
Should Homebuyers Wait for Interest Rates to Drop?
The burning question, especially if you’re buying your first home, is: Should I jump in now or wait? All else being equal, the answer is probably don’t wait. Although mortgage rates have been higher than they were during the pandemic, they’re actually close to the 50-year average. And when rates do drop, the housing market will be flooded by buyers who have been sitting on the sidelines.
While it’s always tempting to wait for lower rates, your personal circumstances are more important. If you’re ready financially and need a new home, higher interest rates shouldn’t deter you. After all, a mortgage refinance could still lower your rate later.
Idaho Mortgage Rate Trends
Understanding historical mortgage rate trends can provide valuable insights into the future. In Idaho, mortgage rates have experienced significant fluctuations over the past two decades. From a high of 7.96% in 2000, rates steadily declined to 5.78% by 2003. While rates have risen in recent years, they remain below historical highs. Experts predict that Idaho mortgage rates will likely stay above historical lows for the foreseeable future.
Below you’ll find the average annual interest rate for Idaho and the United States for 2000 through 2018. (The FHFA stopped reporting the data in 2018.)
Historical Interest Rates in Idaho
| Year | Idaho Rate | U.S. Rate |
|---|---|---|
| 2000 | 7.96 | 7.86 |
| 2001 | 7.03 | 6.94 |
| 2002 | 6.53 | 6.44 |
| 2003 | 5.78 | 5.67 |
| 2004 | 5.75 | 5.68 |
| 2005 | 5.94 | 5.85 |
| 2006 | 6.70 | 6.54 |
| 2007 | 6.55 | 6.42 |
| 2008 | 6.17 | 6.06 |
| 2009 | 5.11 | 5.05 |
| 2010 | 4.87 | 4.81 |
| 2011 | 4.59 | 4.56 |
| 2012 | 3.67 | 3.65 |
| 2013 | 3.86 | 3.84 |
| 2014 | 4.19 | 4.13 |
| 2015 | 3.96 | 3.88 |
| 2016 | 3.77 | 3.73 |
| 2017 | 4.10 | 4.03 |
| 2018 | 4.62 | 4.56 |
Source: Federal House Finance Agency
Historical U.S. Mortgage Rates
Factors Affecting Mortgage Rates in Idaho
As mentioned above, many factors influence mortgage rates in Idaho and nationwide. Some of those are economic, but others are entirely within the homebuyer’s control. Here’s how they break down:
Economic Factors
• The Fed: The federal funds rate serves as a benchmark for other interest rates, including mortgage rates.
• Inflation: When inflation rises, the purchasing power of money decreases, making it more expensive for lenders to lend money. As a result, they may increase interest rates to compensate.
• Unemployment rate: Lower unemployment can result in higher mortgage rates. A low unemployment rate indicates a strong economy, which typically leads to increased demand for housing. This increased demand puts upward pressure on home prices and, not surprisingly, mortgage interest rates.
Consumer Factors
• Credit score: A higher credit score generally results in a lower mortgage interest rate. Lenders view borrowers with higher credit scores as less risky, making them more likely to offer favorable rates.
• Down payment: Increasing your down payment may reduce your mortgage rate. A larger down payment lowers the loan-to-value ratio (LTV), the portion of the home’s value financed by the loan. A lower LTV reduces the lender’s risk and may result in a lower interest rate.
• Income and assets: A steady income is important to lenders, who will check your employment history as well as your salary. Assets like investments and emergency savings also reassure lenders that you could still pay your mortgage in the case of a job loss or other financial setback.
• Type of mortgage loan: Certain types of mortgages tend to have lower rates. For instance, adjustable rate mortgages typically offer lower initial rates than fixed-rate mortgages. Some government-backed loans, like VA mortgages, can also have lower rates. And a shorter loan term usually comes with a lower rate than longer terms.
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Mortgage Options for First-Time Homebuyers in Idaho
Idaho offers a variety of home loan options tailored to different homebuyers. Some options can make it easier for first-time buyers to enter the real estate market. To help you decide which mortgage is the right choice for your situation, we’ll dive into six of the leading types.
Fixed Rate Mortgage
As the name suggests, a fixed-rate mortgage has an interest rate that is fixed across the lifetime of the loan. Fixed-rate mortgages can be 10,15, 20, or 30 years. As we note above, shorter terms usually have lower interest rates than 30-year mortgages.
With a fixed-rate mortgage, as long as you make all your payments on time, your payment will never change. So as rents continue to increase, your fundamental housing cost stays the same.
Adjustable Rate Mortgage
With an adjustable rate mortgage, also known as an ARM, the interest rate can change periodically over the life of the loan. That means your monthly payment can also increase or decrease.
An ARM is labeled with two numbers, such as a 5/1 ARM. The first is the number of the years in the introductory period (5, 7, and 10 year ARMS are the most common). The second is the period when the interest rate will reset. So a 5/1 ARM has a 5-year introductory period, followed by one adjustment per year. A 7/6 ARM has a 7-year introductory period, followed by interest rate adjustments every 6 months.
FHA Loan
Backed by the Federal Housing Administration (FHA), these mortgages are designed to make homeownership more accessible for first-time buyers. They typically have more lenient credit and income requirements compared to conventional loans. FHA loans also allow for lower down payments, with a minimum of 3.5% for qualified borrowers. However, it’s worth noting that FHA loans often come with higher closing costs compared to conventional loans.
VA Loan
VA loans are available to veterans, active-duty military members, and certain reserve and National Guard members. These loans offer no down payment requirement, no private mortgage insurance, and typically lower interest rates compared to conventional loans. VA loans also have less stringent credit and income requirements.
USDA Loan
USDA loans are designed for low-income borrowers looking to purchase a home in a rural area. These loans are backed by the U.S. Department of Agriculture (USDA). Eligibility requirements include income limits and property location restrictions. USDA loans offer $0 down payment requirements and favorable terms.
Jumbo Loan
You might not be aware that conventional mortgage loans have a cap of $726,200 for a single-family home. Monroe County, Idaho, has a higher cap of $874,000. Higher-priced homes require what’s called a jumbo loan, also known as a nonconforming loan. Jumbo loans may have slightly higher interest rates compared to conforming loans, and tougher qualifying standards.
Popular Places to Get a Mortgage in Idaho
Securing a mortgage often depends on choosing the right location, where the cost of living and home prices are affordable. The cost of living refers to how much money it takes to maintain a basic standard of living in a given place.
The Cost of Living Index (COLI) ranks all 50 states against the overall average cost of living in the U.S. Idaho comes in at number 36, with an index of 103.1, a little over the national average. Idaho housing comes in a bit higher, with an index of 108.4.
The average monthly expenses for one person nationwide comes to $3,405 per month. Based on the COLI, Idaho’s statewide average is a bit higher.
Least Expensive Locations
For those seeking the most affordable housing options, several cities in Idaho offer median home prices below the state average, as of Q3 2024:
• Deltona, $313,018. Up 4.1%.
• Gainesville, $302,416. Up 2.6%. Gainesville has a booming job market in education, healthcare, and technology.
• Jacksonville, $301,690. Up 1.0%. This city of 1 million has the second lowest cost of living in the state.
• Lakeland, $324,803. Up 1.6%.
• Lake City, $259,446. Up 5.3%.
• Palm Bay, $314,431 median home price. Up 0.5% over the past year.
• Panama City, $283.600. Up 1.3%.
• Pensacola, $268,099. Up 1.6%. Pensacola offers a cost of living 13% lower than the national average.
Most Expensive Locations
Idaho also has several cities with higher median home prices, catering to those seeking luxury real estate. The median single-family home sale price in Idaho was $420,600 in March 2024, reflecting a year-over-year increase of 3.1%. Idaho’s single-family housing inventory was 40.5% higher year-over-year in March 2024.
Miami Beach is one of the most expensive cities in Idaho, with median home prices exceeding $530,000. Naples is known for its high real estate prices, with home prices often surpassing $600,000.
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Securing a Competitive Mortgage Rate in Idaho
A competitive mortgage rate is crucial for saving money over the life of a loan. Even half a percentage point can translate to many thousands of dollars. For example, a $320,000 mortgage at 6.00% will cost you $370,683 in interest over 30 years. For the same mortgage amount at 6.50%, you’ll pay $408,140 – an additional $37,457.
First, you’ll want to do a little financial housekeeping:
• Pay off high interest debt. Pay down credit cards as much as you can. This will lower your debt-to-income ratio. Mortgage lenders like to see a DTI ratio of 36% or under.
• Save for a larger down payment. Remember, a higher down payment can help you secure a lower interest rate. Down payments of less than 20% are also subject to private mortgage insurance, which can cost between 0.5% and 1.5% of the loan amount annually.
• Check your credit report for errors. Review your credit history, correct any errors, and dispute anything that doesn’t look familiar. You can get a free credit report at AnnualCreditReport.com.
Once you’ve aligned your proverbial ducks, here are two additional tips to help you secure the best possible rate:
Compare Interest Rates and Fees
Take the time to compare interest rates and fees from multiple lenders. And be sure to ask about any upfront costs or closing fees associated with the loan.
Homebuyers can compare the latest mortgage rates in Idaho by using a mortgage rate comparison tool. Just enter your home location, property value, and loan amount. Then filter the results by loan type, such as 30-year fixed, 15-year fixed, or 5-year ARM.
How to Get Preapproved
Getting preapproved for a mortgage strengthens your position as a buyer and allows you to move quickly when you find the right property. If you’re worried about interest rates rising, you can pay a fee to the lender to lock in your rate for up to 90 days.
You’ll fill out a thorough application and provide documentation. The mortgage preapproval process can take 10 days or more, but the work is well worth it.
Idaho Mortgage Resources: Assistance for Homebuyers
Idaho offers various resources and programs to assist homebuyers, particularly first-time buyers and those with limited financial resources.
First-Time Homebuyer Programs
The Idaho Housing Finance Corporation provides programs tailored to first-time homebuyers, including down payment assistance programs and closing cost assistance.
Learn more about Idaho First-time Homebuyer Programs here.
Tools & Calculators
SoFi provides online tools and calculators to help homebuyers estimate their monthly mortgage payments, resources to determine their eligibility for assistance programs and compare different loan options. These resources can empower homebuyers to make informed decisions throughout the homebuying process.
Run the numbers on your home loan.
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Mortgage calculator
Punch in your home loan amount and a new interest rate, and we’ll estimate your payoff date.
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Down payment calculator
Enter a few details about your home loan and we’ll provide your monthly mortgage payment.
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Home affordability calculator
Provide us with a few details and see how much you can afford to spend on a home purchase.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Refinancing Options in Idaho: Exploring Your Possibilities
Refinancing a mortgage can be a strategic move to lower your interest rate, reduce your monthly payment, or access cash for home improvements. Idaho offers various refinancing options, including the FHA Streamline Refinance, Interest-Rate Reduction Refinance Loan, and cash-out refinance.
Each option has its own benefits and requirements, so it’s essential to consult with a mortgage professional to determine the best refinancing strategy for your situation.
Closing Costs and Fees in Idaho: What to Expect
Closing costs associated with purchasing a home in Idaho can range from 3% to 6% of the purchase price. For a $300,000 mortgage to buy a $350,000 house, your closing costs could be between $9,000 and $18,000. It’s important to factor closing costs into your budget when planning for homeownership. Lenders are required to provide a loan estimate that outlines your estimated closing costs within three days of your application.
Closing costs can include any or all of the following:
• Abstract and recording fees
• Application fee
• Appraisal fee
• Attorney costs
• Credit reporting, underwriting, and origination fees
• Flood certification fee
• Home inspection fee
• Homeowners insurance
• Home warranty
• Mortgage points
• Prepaid interest
• Private mortgage insurance
• Title search and title insurance fees
The Takeaway
Idaho’s mortgage landscape offers a range of options for homebuyers. By staying informed about current mortgage rates, exploring assistance programs, and carefully considering refinancing options, individuals can make strategic decisions that align with their financial goals and achieve successful homeownership in the Sunshine State.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
FAQ
What is a mortgage rate?
Simply put, a mortgage rate is the interest rate charged by a lender for borrowing money to purchase a home.
Will mortgage rates drop in Idaho?
Predicting future interest rate movements is challenging, and there is no guarantee that mortgage rates will drop in Idaho. However, state interest rates tend to follow national rates.
Will mortgage rates ever go back to normal?
The definition of normal interest rates varies over time. While current rates are higher than the rock-bottom rates we saw during the pandemic, they are close to the 50-year average, meaning they’re “normal” now.
Will Idaho home prices ever drop?
Real estate market conditions, including home prices, are influenced by supply and demand, economic factors, and location-specific dynamics. Predicting future price movements with certainty is difficult.
Is it a good time to buy a house in Idaho?
Whether it is a good time to buy a house in Idaho depends on individual circumstances and market conditions. If you’re financially ready and need a new home – due to a growing family or relocation — then it’s a good time to buy.
How to lock in a mortgage rate?
To lock in a mortgage rate, you can get preapproved for a mortgage and request a rate lock from the lender. This will secure the current interest rate for a specified period, typically up to 90 days.
How do mortgage interest rates work?
Mortgage interest rates represent the cost of borrowing money from a lender to finance a home purchase. Fixed rates remain the same for the lifetime of the loan, while adjustable rate mortgages (ARMs) have rates that change on a regular basis. For a 5/1 ARM, there’s a five-year introductory period after which your rate changes (up or down) every year.
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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances. SOHL-Q324-029
More home loan resources.
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First-Time Homebuyer Guide
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First-Time Homebuyer Programs and Loans
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Mortgage Preapproval Process