What Mortgage Rate Will You Actually Get in Atlanta?
Mortgage rates are back in the headlines, and the number attached to them is a big one. Before that number talks you out of buying a home in Atlanta, know this: it almost certainly isn’t the rate you’d be quoted.
Freddie Mac’s weekly survey shows the average 30-year fixed rate at its highest level in nearly three years. It’s a real move, and it’s fair to feel it.
Source: Freddie Mac Primary Mortgage Market Survey. National averages, not a rate quote.
But that figure is an average across loan applications nationwide. It isn’t an offer, and it isn’t priced for you. The rate you’d get depends on your credit, your down payment, the loan you choose and even the terms of the contract you negotiate. Some buyers land above the headline. Plenty land below it.
Why the Headline Rate Isn’t Your Rate
A reported or advertised rate is built on assumptions about a borrower who may look nothing like you. A lender prices your loan on your file, and these are the four things they look at first.
“The headline is one number for the whole country. Your rate is your own story, and a lender can tell it to you in a single conversation.”
The Justin Landis Group
Two Ways To Lower Your Rate After You Find a Home
Your rate isn’t decided by your credit file alone. What gets negotiated in the contract matters too, and this is where a good agent earns their keep.
A mortgage rate buydown
A buydown trades an upfront cost for a lower rate and a lower monthly payment. It can be permanent, through discount points, or temporary, like a 2-1 buydown that reduces the rate for the first two years. The part many buyers miss: a seller or builder can pay for it. With more homes for sale across metro Atlanta than there were a few years ago, many sellers are open to the request.
Seller-paid closing costs
Most loan programs let a seller contribute toward your closing costs, up to a cap. On a conventional loan the cap runs from 3% to 9% of the price depending on your down payment, and FHA allows up to 6%. Thousands of dollars you don’t spend at closing can go toward a bigger down payment, paying off a credit card or buying points. Each of those can improve your rate.
For a sense of scale: on a $400,000 loan, a quarter of a percentage point is about $68 a month in principal and interest, or roughly $4,000 over the first five years.
Curious what sellers in your target neighborhood are agreeing to right now?
Start a ConversationPre-Qualified vs. Pre-Approved: Which One Gives You a Real Number?
The only way to find out your rate is to talk to a lender, and there are two levels of that conversation.
A pre-qualification is a quick estimate based on what you tell the lender. A pre-approval is a conditional commitment based on documents the lender has verified. If you want a number you can plan around, you want the pre-approval. Bankrate’s comparison shows why.
| Pre-Qualification | Pre-Approval | |
|---|---|---|
| Financial documentation | Self-reported information only | Lender verifies your information, including pay stubs, tax returns and account statements |
| Loan amount and mortgage rate | Estimated | Exact (pending rate lock) |
| Time required | Often available in minutes | Could take days |
| Credit check | Soft credit check | Hard credit check |
Source: Bankrate
One local note. In metro Atlanta, most listing agents expect a pre-approval letter to come with an offer. A pre-qualification on its own can put you behind another buyer before price is even discussed.
How To Get Ready for the Lender Conversation
Ask the lender what they’ll need up front. It’s usually recent pay stubs, two years of W-2s or tax returns and a couple of months of bank statements. Then bring questions of your own.
- What do I gain or lose by waiting 3, 6 or 12 months to buy?
- What’s my rate at a few different down payment amounts, and where does mortgage insurance drop off?
- Would paying points or a seller-funded buydown make sense for how long I plan to stay?
- How would a rate move in either direction change my payment and my budget?
- What’s the benefit of starting to build equity now compared with waiting?
- Are there tax advantages to owning that apply to me? (Take that one to your tax professional too.)
- Do I qualify for down payment assistance, such as the Georgia Dream program?
- How long is my pre-approval good for, and when should I lock my rate?
Atlanta Mortgage Rate Questions, Answered
Is the mortgage rate I see online the rate I’ll get in Atlanta?
Usually not. Published rates are national averages or advertised rates built around an assumed borrower. Your rate is priced on your credit score, debt-to-income ratio, down payment, loan type and term, so it can come in higher or lower than the headline. A lender can give you your number after reviewing your finances.
What is the difference between pre-qualification and pre-approval?
A pre-qualification is an estimate based on self-reported information and usually involves a soft credit check. A pre-approval is a conditional commitment from a lender based on verified pay stubs, tax returns and account statements, and it involves a hard credit check. A pre-approval gives you a more accurate rate and loan amount.
Can a seller pay to lower my mortgage rate?
Yes. A seller or builder can fund a rate buydown or contribute to your closing costs, within limits set by your loan program. Conventional loans cap seller contributions at 3% to 9% of the price depending on your down payment, and FHA loans cap them at 6%. Your agent negotiates this as part of the offer.
Does getting pre-approved hurt my credit score?
A pre-approval involves a hard credit inquiry, which can lower your score by a few points for a short time. Credit scoring models generally count multiple mortgage inquiries made within a short shopping window, typically 14 to 45 days depending on the model, as a single inquiry, so you can compare lenders without stacking up inquiries.
The Bottom Line
The rates in the news can make buying a home sound out of reach. For some Atlanta buyers, waiting will be the right call. For others, the real number turns out to be workable, especially with a seller helping on the rate. You can’t tell which group you’re in from a headline.
One conversation with a lender gets you your rate, your budget and your options. From there the decision is yours, and it’s an informed one.
Buying in Metro Atlanta
Find Out What Your Rate Really Is
Reach out and we’ll listen to where you are and what you’re hoping to do, then introduce you to local lenders our clients have had good experiences with. You’re always free to use any lender you choose.
- A pre-approval that shows your real rate and budget
- A plan for negotiating buydowns and seller-paid costs
- An agent who knows your target neighborhoods
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This article is for general information only and is not financial, lending, tax or legal advice. The Justin Landis Group is a real estate team, not a lender, and nothing here is a loan offer, rate quote or commitment to lend. Mortgage rates cited are national averages as reported for the dates shown and change daily. Your rate, loan terms and eligibility depend on your credit, income, down payment, property and lender. Payment examples show principal and interest only and are illustrations. Seller contribution limits, loan limits and assistance programs vary by program and are subject to change, so confirm current guidelines with your lender. The Justin Landis Group is part of Bolst, Inc., a Certified B Corporation™ brokerage. 404-860-1816.