If you’re looking to purchase a home in Montana, chances are you’re wondering what kind of interest rates you might be getting if you decide to finance your home. Montana is the fourth biggest state in the United States but is less densely populated with only 6.5 people per square mile. That makes Montana the 48th state in population density.
The largest city in Montana is Billings with a population of 109,059 people. The second biggest city, Missoula Montana, has just 69,122. Because we’re talking such small populations, the variation in Montana interest rates is going to be small. Let’s look at the interest rates as they pertain to Montana, including  Billings, Bozeman, Glendive, Great Falls, Helena, and Missoula, and what may be available in the future.
Montana’s Mortgage Rates
Now is a terrific time to look for a new home in Montana. Most people hold mortgage loans on their homes when the choose to purchase a home. Mortgage rates determine how much money in interest you’ll pay to finance your home. The most common loans are 30 year fixed rate, 15 year fixed rate, and something called a 5/1 ARM. Fixed rate mortgages are just that: fixed rate. That means the rate you get is the same regardless of whether it is the first year of the loan or the last. 5/1 ARMs or adjustable rate mortgages start out as a fixed rate for the first five years. After that, the mortgage rate changes on a yearly basis to the current mortgage rate. That may make your mortgage payment higher or lower, depending on the interest rate.
When considering what type of mortgage is best for your circumstances, be aware that fixed rate mortgages hold the least surprises, and you can refinance if the rates go lower. Adjustable Rate Mortgages may be easier to get into, but if the rates skyrocket, you don’t want to be in the position of potentially losing your home. 5/1 ARMs are usually good for people who are not going to be living in the home for more than five years.
According to Bankrate, the Montana mortgage rate average for a 30 year fixed mortgage is 3.52 percent. A 15 year fixed mortgage has a rate of 2.78 percent, and a 5/1 ARM is 3.01 percent. These rates vary by region, of course, so you’ll need to look around nearby cities for an idea what kind of rates you can get. Montana’s mortgage rates vary depending on where you choose to live. Other factors that affect your mortgage rates include your credit score, your down payment, the amount of money you’re borrowing from the bank, and the number of years you’re financing.
It’s unlikely you will see those figures when you go to get a mortgage loan as those are the very best numbers under the right circumstances. Your rate may be higher or lower since that is an average for those with good credit. To give you a flavor of what you might expect to see in Montana, we’ll take a look at mortgage interest rates in Billings, Bozeman, and Helena.
Billings, Montana Mortgage Rates
Billings, Montana is the biggest city in Montana with a population of 109,059 in 2013. Situated in the Yellowstone Valley and not far from Little Bighorn and the Bighorn Mountains, Billings is the economic powerhouse of Montana. If you purchase your home in Billings, Montana with a 30 year fixed rate mortgage and zero points, expect to see an interest rate of 3.66 percent APR up to 3.92 percent APR. If you purchase a 15 year fixed mortgage with zero points, your interest rate should be somewhere between 2.91 percent APR and 3.63 percent APR. If you choose a 5/1 ARM mortgage with no points, you will see an interest rate of 3.22 percent APR up to 3.41 percent APR.
Bozeman, Montana Mortgage Rates
Bozeman, Montana is often called the Gateway to Yellowstone, and with good reason. It isn’t far from Yellowstone National Park and Bridger Bowl Ski Area. Plenty of movies were filmed here including “A River Runs Through It.” Many of the Hollywood elite own ranches near Bozeman. Someone looking to purchase a home in Bozeman, Montana with a 30 year fixed mortgage and no points can expect to pay between 3.66 percent APR and 3.91 percent APR. A 15 year fixed mortgage with no points will yield results between 2.88 percent APR and 3.62 percent APR. If you choose to get a 5/1 ARM mortgage with no points, you’re looking at a mortgage rate of 3.21 percent APR to 3.41 percent APR.
Helena, Montana Mortgage Rates
Helena, Montana is the capital of Montana and was founded when the four Georgians found gold in Last Chance Gulch. Like most of Montana, Helena, Montana has a range of interest rates depending upon what product you purchase. A 30 year fixed mortgage with zero points may cost you 3.54 percent APR up to 3.90 percent APR interest. If you get a 15 year fixed mortgage with no points, you can expect to see a 2.83 percent APR up to a 3.61 percent APR interest. If you go with a 5/1 ARM mortgage with zero points, your range is likely to be 3.2 percent APR up to 3.4 percent APR.
Predictions for 2016
There is no real consensus when it comes to what will happen to mortgage rates in the next year. As Colin Robertson of TheTruthAboutMortgage.com says, it is really hard to predict mortgages and their mortgage rates because of any number of unforeseen events can occur. He tells My Mortgage Insider that he doesn’t expect to see a significant increase in rates.
Other finance experts aren’t so certain. Brad Yzermans of HomeLoanArtist.com actually predicts that mortgage rates will shoot up to 4.75 percent before the end of the year. And then there are other financial and mortgage experts who believe rates will rise, but don’t believe that they will rise substantially.
Regardless, buying a home now will lock in today’s interest rates. If mortgage rates do fall, you can always refinance your home and get a lower rate. But if the rates are high, there’s nowhere to go in terms of relief.
2 Point Highlight
Buying a home now will lock in today’s interest rates. If mortgage rates do fall, you can always refinance your home and get a lower rate.
