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Compare mortgage rates in West Virginia.
Key Points
• Mortgage rates are influenced by economic factors (inflation, unemployment rate, Federal Reserve influence) and consumer factors (credit score, down payment).
• West Virginia offers various mortgage types: fixed-rate mortgages, adjustable-rate mortgages (ARMs), FHA loans, VA loans, USDA loans, and jumbo loans.
• Homebuyers can improve their chances of securing a competitive mortgage rate by comparing interest rates, improving their credit score, making a larger down payment, and keeping their debt-to-income ratio low.
• Resources available to assist homebuyers in West Virginia include first-time homebuyer programs, down payment assistance, online tools and calculators, and refinancing options.
Introduction to Mortgage Rates
Understanding mortgage rates is crucial to choosing the right home loan for your situation. Mortgage interest rates are calculated using a complex combination of factors that can be sorted into two buckets: the state of the economy and the borrower’s financial status. Economic factors include the Federal Reserve’s interest rate decisions, inflation, and unemployment rates. In the other bucket, borrower-specific factors such as credit score, down payment, income, assets, and type of mortgage loan also influence the interest rate offered.
Where Do Mortgage Rates Come From?
Whether you’re buying your first home or an old hand at the mortgage game, you’ve probably wondered who determines mortgage rates. The Federal Reserve, also known as the Fed, sets the short-term interest rates that banks use. Although home loan rates are not directly tied to Fed rates, they tend to follow the same economic trends. When the Fed’s interest rate is high, chances are mortgage rates will be higher as well.
How Interest Rates Affect Home Affordability
Mortgage rates have a more significant impact on home affordability than many people realize. Even small changes in interest rates can make a substantial difference in monthly mortgage payments and the overall cost of purchasing a home. For instance, a one percentage point increase in interest rate on a $200,000 loan can result in an additional $120 in monthly payments, translating to $1,440 more per year.
Should Homebuyers Wait for Interest Rates to Drop?
Many first-time homebuyers have a dilemma: Buy now or wait for interest rates to come down? While it’s tempting to wait for a more favorable interest rate environment, it’s important to consider that rates can be unpredictable and may not always move in the desired direction. Additionally, waiting could mean seeing home prices rise (canceling out any interest rate savings) and increased competition among buyers.
It’s worth noting that homeowners can always consider a mortgage refinance if rates do go down, potentially lowering their monthly payments and saving money in the long run. Therefore, buying a home when it makes sense for your personal circumstances and financial situation may be a better strategy than waiting solely for lower interest rates.
West Virginia Mortgage Rate Trends
Understanding historical mortgage rates can provide valuable insights into where rates are headed. While rates have risen in recent years, they remain below historical highs and are currently around the 50-year average. This indicates that current mortgage rates are relatively moderate compared to long-term trends.
Historical Interest Rates in West Virginia
Mortgage rates in West Virginia over this 20-year span have ranged from a high of 8.31% in 2000 to a low of 3.82% in 2012. While rates hovered in the 3.00% range during the height of COVID-19, it’s clear that rates of 6.00% to 7.00% are more in line with what’s “normal.”
| Year | West Virginia Rate | U.S. Rate |
|---|---|---|
| 2000 | 8.31 | 8.14 |
| 2001 | 7.08 | 7.03 |
| 2002 | 6.65 | 6.62 |
| 2003 | 5.87 | 5.83 |
| 2004 | 5.84 | 5.95 |
| 2005 | 6.01 | 6.00 |
| 2006 | 6.53 | 6.60 |
| 2007 | 6.46 | 6.44 |
| 2008 | 6.02 | 6.09 |
| 2009 | 5.17 | 5.06 |
| 2010 | 4.86 | 4.84 |
| 2011 | 4.72 | 4.66 |
| 2012 | 3.82 | 3.74 |
| 2013 | 3.83 | 3.92 |
| 2014 | 4.24 | 4.24 |
| 2015 | 3.99 | 3.91 |
| 2016 | 3.92 | 3.72 |
| 2017 | 4.21 | 4.03 |
| 2018 | 4.60 | 4.57 |
Historical U.S. Mortgage Rates
Mortgage rates in the United States have experienced significant fluctuations over the years. In the 1980s, rates reached double digits, peaking at over 18%. They have generally trended downward since then. The current mortgage rate environment is considered relatively favorable compared to historical averages.
Factors Affecting Mortgage Rates in West Virginia
As noted above, numerous factors influence mortgage rates in West Virginia and nationwide. Some of these factors are economic, while others are entirely within the homebuyer’s control.
Economic Factors
• The Fed:The federal funds rate serves as a benchmark for other interest rates, including mortgage rates. When the Fed raises the federal funds rate, it typically leads to higher mortgage rates.
• Inflation:When inflation rises, the purchasing power of money decreases, making it more expensive for lenders to lend money. As a result, they may increase interest rates to compensate for the reduced value of their investments.
• Unemployment rate: Lower unemployment can result in higher mortgage rates. A low unemployment rate indicates a strong economy, which typically leads to increased demand for housing. This increased demand puts upward pressure on home prices and, not surprisingly, mortgage interest rates.
Consumer Factors
• Credit score: A higher credit score generally results in a lower mortgage interest rate. Lenders view borrowers with higher credit scores as less risky, making them more likely to offer favorable terms.
• Down payment: Increasing your down payment may reduce your mortgage interest rate. A larger down payment lowers the loan-to-value (LTV) ratio, which indicates a lower risk for the lender. As a result, lenders may offer a lower interest rate to borrowers with a higher down payment.
• Income and assets: A steady income is important to lenders, who will check your employment history as well as your salary. Assets like investments and emergency savings also reassure lenders that you could still pay your mortgage in the case of a job loss or other financial setback.
• Type of mortgage loan: Certain types of mortgages tend to have lower rates. For instance, adjustable rate mortgages (ARMs) typically offer lower initial rates than fixed-rate mortgages. Some government-backed loans, like VA mortgages, can also have lower rates. And a shorter loan term usually comes with a lower rate than longer terms.
Types of Mortgages Available in West Virginia
Various mortgage types — including fixed-rate, adjustable-rate, FHA, VA, and USDA loans — are available to meet the needs of different homebuyers in West Virginia.
Conventional Loan
Conventional loans are not backed by the government and are offered by banks, credit unions, and online lenders. The most popular type of mortgage loan, they can be fixed-rate, adjustable, or a hybrid. Borrowers typically need a credit score of 620 for a conventional loan.
Fixed-Rate Mortgage
Fixed-rate mortgages maintain the same interest rate throughout the life of the loan, ensuring that the monthly payments remain constant. Fixed-rate mortgages are available in terms of 10, 15, 20, or 30 years. In a nutshell: long-term predictability.
Adjustable-Rate Mortgage (ARM)
Adjustable-rate mortgages (ARMs) initially offer a lower rate than fixed-rate loans. However, after a specified period, usually 5, 7, or 10 years, the interest rate can adjust periodically based on market conditions. ARMs can be beneficial if you plan to sell your home before the fixed period ends. In a nutshell: lower initial rate, more risk.
FHA Loan
FHA loans are backed by the Federal Housing Administration and are designed for borrowers with less-than-perfect credit or a smaller down payment. FHA loans typically have more lenient eligibility requirements than conventional loans and allow for down payments as low as 3.5%. One downside is that borrowers are required to carry mortgage insurance for the life of the loan.
VA Loans
VA loans are available to veterans, active-duty military members, and some Reserve and National Guard members. They do not require a down payment and offer competitive interest rates. Even though the Department of Veteran Affairs (VA) sets the eligibility requirements and guarantees the loan, borrowers apply to private lenders, after obtaining a certificate of eligibility (COE) from the VA.
USDA Loans
USDA loans are designed for low-income borrowers looking to purchase a home in a rural area. They do not require a down payment nor private mortgage insurance and may offer lower interest rates than conventional loans. However, the loans require a 1% upfront fee and a 0.35% annual fee, based on the remaining principal. The USDA does not have a firm credit score requirement, but you are mostly likely to be approved if your score is 640 or higher.
Jumbo Loans
Jumbo loans are conventional mortgage loans that exceed the conforming loan limit set by the Federal Housing Finance Agency (FHFA). In most of West Virginia, the conforming loan limit for a single-family home is $726,000. However, in Jefferson County, it’s $1,149,825. Jumbo loans typically require a larger down payment and may have higher interest rates than conforming loans.
Popular Places to Get a Mortgage in West Virginia
Securing a mortgage often depends on choosing the right location, where home prices are affordable and mortgage terms are favorable. West Virginia is home to some of the best affordable places in the U.S.
One way home buyers search for affordable areas is by looking at the local cost of living (COL), as compiled by the Missouri Economic Research and information Center (MERIC). According to the second quarter 2024 figures, West Virginia ranks Number 1 in affordability among the 50 states. (Hawaii ranks 50.)
• Morgantown: Known for its university town atmosphere and outdoor recreation opportunities, Morgantown offers a diverse range of housing options. Average home value (Sept. 2024): $268,994.
• Charleston: The capital city of West Virginia, Charleston provides a mix of urban amenities and natural beauty. It has a steady job market and a variety of mortgage lenders. Average home value (Sept. 2024): $155,061.
• Huntington: Located in the western part of the state, Huntington is known for its vibrant arts scene and historic architecture. It offers affordable housing and a range of mortgage options. Average home value (Sept. 2024): $128,920.
• Parkersburg: Situated along the Ohio River, Parkersburg is a charming city with a strong sense of community. It has a diverse economy and a variety of mortgage lenders. Average home value (Sept. 2024): $139,934.
Least Expensive Locations
• Welch: Welch may be the most affordable place to buy a home in West Virginia. It is located in the southern part of the state and offers a variety of outdoor activities. Average home value (Sept. 2024): $40,137.
• Williamson: Another affordable option is Williamson, located in the southern coalfields region. The median home price in Williamson is $74,900, and it offers a range of outdoor activities and cultural attractions. Average home value (Sept. 2024): $61,338.
• Logan: Situated in the southwestern part of the state, Logan is known for its natural beauty and outdoor recreation opportunities. Average home value (Sept. 2024): $75,100.
Most Expensive Locations
• Shepherdstown: The most expensive place to buy a home in West Virginia is Shepherdstown, located in the eastern panhandle. It is known for its historic charm and proximity to Washington, D.C. Unlike most of WV, living here costs more than the average cost of living in the U.S. Average home value (Sept. 2024): $468,540.
• Charleston: The capital city of West Virginia also ranks among the most expensive places to buy a home. The area offers a mix of urban amenities and natural beauty. Average home value (Sept. 2024): $155,061.
• Morgantown: Known for its university town atmosphere and outdoor recreation opportunities, it is a popular place to live and work, which contributes to the higher housing costs. Average home value (Sept. 2024): $268,994.
Tips for Securing a Competitive Mortgage Rate in West Virginia
A competitive mortgage rate is crucial for saving money over the life of a loan. Even half a percentage point can translate to many thousands of dollars in interest paid. Here are some tips for securing a competitive mortgage rate in West Virginia:
Compare Interest Rates and Fees
Take the time to compare interest rates and fees from multiple lenders. Don’t just go with the first offer you receive. Be sure to ask about any upfront costs or closing fees associated with the loan.
Get Preapproved
Getting preapproved for a mortgage strengthens your position as a buyer and allows you to move quickly when you find the right property. Preapproval also gives you a better idea of how much you can afford to borrow. Just plan ahead: The mortgage preapproval process can take as long as 10 days or more.
Consider a Shorter Loan Term
Shorter loan terms typically — for instance, 15 years — generally come with lower interest rates. Borrowers will not only pay off their loan faster, they’ll save significantly on interest over the life of the loan. If you can afford it, opting for a shorter loan term can save you money in the long run.
Improve Your Credit Score
A score as low as 500 may open the door to homeownership, but the lowest rates go to borrowers with scores of 740 and above. Take steps to improve your credit score, such as paying bills on time, reducing debt, and avoiding opening new credit accounts.
Make a Larger Down Payment
Increasing the down payment can lower the mortgage interest rate. The median down payment on a home in 2024 is 15%. A larger down payment reduces the loan-to-value (LTV) ratio, which indicates a lower risk for the lender. Some government-backed loans require a down payment of 5% or 10%. With a down payment of 20% or more, you’ll also save money by avoiding private mortgage insurance.
West Virginia Mortgage Resources
West Virginia offers numerous resources and programs to assist homebuyers, particularly first-time buyers and those with limited financial resources. Keep in mind: You might assume that to qualify as a first-time home buyer, you must never have owned a house. But in most West Virginia counties, and nationwide, it means you haven’t owned a primary home in the past three years.
• West Virginia Housing Development Fund (WVHDF): This program provides lower-interest loans and down payment assistance programs to eligible first-time homebuyers.
• Charleston Homebuyer Assistance Program: The Home Blend Program offers forgivable loans of up to $128,000 with a 10-year repayment term at 0% for lower-income, first-time buyers looking to purchase in Charleston or Kanawha County.
• Martinsburg Homebuyer Assistance Program: First-time buyers looking in Martinsburg, or Berkeley, Jefferson, or Morgan counties can secure deferred no-interest loans to be used for a down payment and closing costs.
Recommended: West Virginia First-Time Home Buying Assistance Programs and Grants
Refinancing Options in West Virginia
Refinancing your mortgage can be a smart move if you can secure a lower interest rate or improve your loan terms. Here are a few refinancing options available in West Virginia:
Cash-Out Refinance
With a cash-out refi, you take out a new mortgage for a larger amount than what you have left on your current mortgage and receive the excess as cash. You can use the cash for remodeling, debt consolidation, or paying for college costs.
FHA Streamline Refinance
The FHA Streamline Refinance allows FHA-insured homeowners to refinance into current mortgage rates with minimal hassle. This option is available to borrowers who are current on their mortgage payments and have a good credit history.
Interest-Rate Reduction Refinance Loan
An Interest-Rate Reduction Refinance Loan (IRRRL), also known as a VA Streamline Refinance, can reduce the monthly payments on VA loans by adjusting the APR. This option is available to eligible veterans and active-duty military members.
Tools & Calculators
SoFi provides online tools and calculators to help homebuyers estimate their monthly mortgage payments, resources to determine their eligibility for assistance programs and compare different loan options. These resources can empower homebuyers to make informed decisions throughout the homebuying process.
Run the numbers on your home loan.
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Mortgage calculator
Punch in your home loan amount and a new interest rate, and we’ll estimate your payoff date.
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Down payment calculator
Enter a few details about your home loan and we’ll provide your monthly mortgage payment.
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Home affordability calculator
Provide us with a few details and see how much you can afford to spend on a home purchase.
Using the free calculators is for informational purposes only, does not constitute an offer to receive a loan, and will not solicit a loan offer. Any payments shown depend on the accuracy of the information provided.
Closing Costs, Taxes, and Fees in West Virginia
When buying a home in West Virginia, you can expect to pay closing costs, which include various fees and charges associated with the mortgage loan. Closing costs in West Virginia typically range from 2% to 5% of the home’s purchase price. Some common closing costs include:
• Loan origination fee: Charged by the lender for processing the mortgage loan application.
• Appraisal fee: Paid to an appraiser to determine the value of the property.
• Credit report fee: Paid to a credit bureau for obtaining your credit report.
• Title insurance: Protects the lender against any issues with the title to the property.
• Recording fee: Paid to the county recorder’s office for recording the mortgage documents.
The Takeaway
West Virginia’s mortgage landscape offers a range of options for homebuyers. By staying informed about current mortgage rates, exploring assistance programs, and carefully considering refinancing options, individuals can make strategic decisions that align with their financial goals and achieve successful homeownership in the Mountain State.
Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.
FAQ
Will mortgage rates drop in West Virginia?
Predicting future mortgage rate trends is challenging, as they are influenced by numerous economic factors and each borrower’s financial profile. However, it is worth noting that mortgage rates in West Virginia are currently around the 50-year average and have risen in recent years. While rates can fluctuate, there is no guarantee that they will drop in the future.
Will mortgage rates ever go back to normal?
The definition of “normal” mortgage rates can vary depending on historical periods and economic conditions. Mortgage rates have experienced significant fluctuations over the years, with periods of both high and low rates. While rates may not return to the 3.00% level of recent years, they are currently hovering around the historical average.
Will mortgage rates ever go back to normal?
The definition of normal interest rates varies over time. While current rates are higher than the rock-bottom rates we saw during the pandemic, they are close to the 50-year average, meaning they’re “normal” now.
Will West Virginia home prices ever drop?
West Virginia is currently ranked Number 1 in housing affordability, which makes further price drops unlikely or minimal at best.
Is it a good time to buy a house in West Virginia?
Determining the right time to buy a house involves considering personal financial circumstances, housing market conditions, and long-term goals. While mortgage rates and home prices can impact affordability, it is important to assess your individual situation, including job stability, income, and housing needs, to make an informed decision about buying a home.
How to lock in a mortgage rate?
Locking in a mortgage rate means securing a specific interest rate for a certain period of time, typically up to 90 days. To lock in a mortgage rate, you can pay a fee to the lender, which is usually a percentage of the loan amount. Locking in a rate can provide peace of mind and protect you from potential rate increases during the loan application process.
How do mortgage interest rates work?
Mortgage interest rates are determined by a combination of factors, including the current federal funds rate set by the Federal Reserve, economic conditions, inflation, and borrower-specific factors such as credit score, down payment, and loan type. Lenders use these factors to assess the risk associated with lending money and set interest rates accordingly.
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*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances. SOHL-Q324-103
More home loan resources.
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First-Time Homebuyer Guide
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First-Time Homebuyer Programs and Loans
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Mortgage Preapproval Process