Your qualifying mortgage loan interest in most cases is equal to the note rate, especially on standard fixed rate mortgage loans.
The qualifying interest rate usually comes into play on adjustable rate loans, and buy down programs.
Your adjustable rate loan has a start rate, which is what the loan interest rate is today, and then a maximum cap interest rate, which is the worst it can ever be. When underwriting loans, the program may require lenders to use something other than the current start rate to calculate affordability. This is usually the worst case interest rate, but can be something different.
This rate used to determine affordability is therefore known as the qualifying rate.
33 Wentworth Ave E
Suite 290
West St Paul, MN 55118
651-552-3681
651-252-1342
Cambria Mortgage | NMLS# 322798
Joe Metzler, MLO. NMLS# 274132
Branch NMLS 1888858
Licensed in MN. WI, SD
Cambria Licensed Mortgage Loan Officer serving home owners, home buyers and residential real estate investors. Equal Housing Lender, Cambria Mortgage NMLS #322798. I am a licensed mortgage originator, NMLS #274132, and am licensed to originate mortgage loans in: MN, WI, IA, ND, and SD. Lending services may be provided in certain states by Cambria Mortgage NMLS #322798. This is not an offer to lend or to extend credit, nor is this a guaranty of loan approval or commitment to lend. The information here may not be up-to-date and may no longer be accurate. Consumers must independently verify the accuracy and currency of available mortgage programs. All loan approvals are subject to the borrower(s) satisfying all underwriting guidelines and loan approval conditions and providing an acceptable property, appraisal and title report. Actual rates available to you may vary based upon a number of factors. Consumers must independently verify the accuracy and currency of available mortgage programs. All loan approvals are subject to the borrower(s) satisfying all underwriting guidelines and loan approval conditions and providing an acceptable property, appraisal and title report. © 2021 Joe Metzler