FHA Loan Interest Rates

FHA Loan Interest Rates in Colorado

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Many people assume the FHA sets the interest rates for FHA loans in Colorado. But the FHA’s role is only to insure the loans for lenders. FHA-approved lenders set the rates based on the current market, along with other personal criteria.

What Determines FHA Loan Interest Rates in Colorado?

FHA lenders look at your personal qualifying factors. The less risk of default you pose, the lower the interest rate they’ll quote you. Lenders use risk-based pricing which means the higher your chances of default, the higher the interest rates lenders charge.

To get the best interest rates, lenders look for:

• High credit scores – The higher your credit score the better, as this demonstrates a lower risk
• Low debt-to-income ratios – The lower your DTI, the more money you have to pay your mortgage, which lowers your risk
• Attractive loan types – ARM loans have a higher risk of default than fixed-rate loans because of their volatility

I can help you compare available FHA lender offers, including interest rate, APR, fees and loan terms. Your eligibility and pricing depend on your circumstances.