When it comes to buying a home in North Carolina, many people are new to the process. The best way to avoid mistakes is to understand the process of buying a home, particularly first-time home buyers should understand interest rates that are available to them. The following are typical interest rates currently available and predictions for mortgage interest rates throughout 2016 in North Carolina.

Current North Carolina Mortgage Rates

Interest rates vary from state to state and depend on a number of factors. For instance, the cost of providing loans in North Carolina has a bearing on mortgage interest rates for banks. Based on this information, it is important for first-time home buyers to strive for the lowest interest rates possible so that they can save money when they purchase a home.

Currently, in North Carolina, the following interest rates prevail.

• 30-Year Mortgage: 3.72 percent
• 15-Year Mortgage: 2.77 percent
• 5/1 Arm: 3.15 percent

Banks Offering Mortgages in North Carolina

There are a number of banks offering mortgages for residents of North Carolina. If you are considering buying a home, you should review each bank offering low mortgage interest rates. The interest rate you pay for your mortgage matters because a lower interest rate means you will pay less for your home over the life of your loan. Of course, the interest rates listed below does not consider individual factors that impact mortgage interest rates. For instance, your credit score, your income, and the type of home you purchase will affect the mortgage interest rate you get from your mortgage lender.

Bank of America

Bank of America is a national bank that provides many people with mortgage loans. By choosing a national bank, many people have access to many mortgage tools, making it easier for them to choose a mortgage that works best for them. Currently, the average mortgage rate from Bank of America in North Carolina is 3.5 percent for a 30-year fixed, 2.75 percent for a 15-year fixed, and 2.75 percent for a 5/1 adjustable rate mortgage (ARM).

Wells Fargo Home Mortgage

Another leader in the industry when it comes to home mortgages is Wells Fargo. Wells Fargo is considered the #1 mortgage lender in America, offering many mortgage vehicles for the residents of North Carolina. Their current mortgage rates are 3.625 percent for a 30-year fixed rate, 3.00 percent for a 15-year fixed rate, and 3.625 percent for a 5/1 ARM.

State Employees Credit Union

Another local favorite when it comes to banking is State Employees Credit Union (SECU). SECU is a local bank available exclusively in North Carolina. Residents are able to become members if they are a state employee, public school employee, retiree from the state or public school system, county employee, and member of the National Guard. Additionally, family members of these individuals and those who share a single economic unit with these individuals are able to become members and take advantage of their mortgage rates.

SECU offers competitive interest rates for people who are purchasing a home in North Carolina. Currently, they offer a 15-year fixed at 15 percent, and a 10-year fixed at 3.75 percent. They also offer a number of ARMs for 30-year mortgages.

Predictions for Mortgage Rates in North Carolina

In addition to knowing where the lowest interest rates are in North Carolina, first-time home buyers must know the state of the market. With more information about the market, buyers can make better decisions about when to purchase a home, and they can decide on the best lender for their mortgage.

North Carolina’s Housing Market Will Not Change Significantly

Wells Fargo Securities predicts stable job growth for 2016 in North Carolina. They also estimate that the unemployment rate will continue to decline. Based on Wells Fargo Securities’ predictions, it is reasonable to assume that the housing market of 2016 in North Carolina will mimic that of 2015. Home buyers will not have a tough time finding homes for sale.

More Millennials Will Enter the Housing Market

With Janet Yellen of the Federal Reserve reiterating the rise in interest rates for this year, many people think that rising interest rates will have a significant negative impact on the market. Fortunately, it is highly anticipated that Millennials will enter the housing market, which may more than offset the people who exit the market due to interest rate hikes. In particular, the North Carolina housing market will likely increase before the new interest rates take effect, allowing Millennials and others to beat the impending hikes.

Single-Family Homes Continue to Be a Hot Commodity

Residents of North Carolina value homeownership. The homeownership rate in the state continues to outpace that of the United States. In North Carolina, over 66 percent of the residents own a home, compared to nearly 65 percent in the United States. In December 2015, there was a total of 10,076 private building permits issued, a change of nearly four percent month over month. With more private building permits issued in December, residents can anticipate new homes going up across the state, providing home buyers with access to new homes.

Migration to Suburbs Outside of Metro Areas Will Continue

One of the benefits of living in North Carolina is the fact that local city managers make efforts to preserve the natural look of the state. Preservation of the state’s greenery is important in suburban areas, along with lower costs. As a result, many people are migrating to the outskirts of metro areas in the city. They like having access to nature and avoiding the hustle and bustle of the city. Although cities like Charlotte and Raleigh continue to thrive, most people value living in a small town with direct access to these areas. By doing this, they have access to high-paying jobs, entertainment, and cultural events; however, they still enjoy a peaceful place called home in the suburbs.

If you are anticipating purchasing a home in North Carolina this year, you should take the time to understand mortgage interest rates. With interest rates varying from state to state and from lender to lender, you can improve your chances of getting a better rate by learning what lenders are offering.

2 Point Highlight

The best way to avoid mistakes is to understand the process of buying a home, particularly first-time home buyers should understand interest rates that are available to them.

Based on Wells Fargo Securities’ predictions, it is reasonable to assume that the housing market of 2016 in North Carolina will mimic that of 2015.