Posted on December 3rd, 2020
The leading wholesale mortgage lender in the nation has brought the heat once again, this time offering 30-year fixed mortgage rates below 2% on FHA loans.
United Wholesale Mortgage announced that borrowers can now lock in interest rates as low as 1.99% on FHA-backed loans via its popular Conquest program.
The new Conquest for FHA offering matches the low 1.99% rate they’ve been offering on conventional loans backed by Fannie Mae and Freddie Mac.
This means borrowers can choose between FHA loans and conventional loans and still secure some of the lowest mortgage rates around.
UWM is also offering these same low rates for VA loans as well, so all borrowers are covered, even those with high-balance conforming loans.
Conquest for FHA Details
- Mortgage rates start at 1.999%
- Can be a purchase loan or rate and term refinance
- Primary residences only
- Also permits FHA streamline refinances on both primary and secondary homes
- Loan must not have closed with UWM in the last 18 months
- Minimum FICO score of 640 required
- No debt-to-income (DTI) maximum
- Can lock rates for anywhere from 8-22 days
This exciting new loan program allows both new home buyers and current homeowners to take part, assuming it’s your primary residence.
You can take out a home purchase loan or a rate and term refinance if you’re looking to save money on your existing mortgage.
Additionally, those who apply or an FHA streamline refinance can qualify if the property is a primary residence or a second home.
There is a minimum FICO score of 640, but there isn’t a debt-to-income ratio cap, so it’s pretty flexible and should be relatively easy to qualify for compared to other loan programs.
Because UWM is a wholesale mortgage lender, you can’t apply directly. Instead, you’ll need to seek out a mortgage broker who is approved to work with UWM.
Seeing that they’re the #1 wholesale lender in the nation, that shouldn’t be too difficult.
Can You Really Get a Mortgage Rate Below 2%?
Yes, according to UWM, mortgage rates start at 1.999%. So just a hair below 2%.
The caveat is that there will likely be discount points involved to buy down your rate to those levels.
While UWM does appear to offer competitive mortgage rates, there is a little bit of marketing magic taking place here as well.
Essentially, they can advertise lower-than-market mortgage rates by tacking on discount points, which are a form of prepaid interest.
In other words, you pay some of the interest upfront at closing as opposed to monthly via a higher mortgage rate and corresponding mortgage payment.
It can be beneficial to pay points if you plan on keeping the property for the long-haul, and you don’t think you’ll refinance the mortgage again anytime soon.
But if you don’t plan on sticking around, or expect mortgage rates to fall even more to the point where you could refinance your mortgage a second time, it may not make sense to pay discount points.
Regardless, you can still ask for pricing with and without discount points and compare other lender options since brokers have the ability to provide pricing from all their wholesale lending partners at once.
In terms of lock periods, since it’s important to actually secure your low rate, UWM allows locks from 8-22 days.
They say their average loan submission to clear-to-close (CTC) timeline takes just 15 days, which is certainly faster than the industry at the moment.
Another perk to this program is the ability to pick any loan term you’d like between 8-30 years, assuming it’s a non-jumbo FHA.
For example, if you’re already seven years into a 30-year fixed and don’t want to restart the clock, you can go with a 23-year loan term and stay on course.
However, if it’s a jumbo FHA loan amount, you’re limited to the standard 15-year fixed and 30-year fixed terms.
Whenever UWM announces these low-rate deals it’s generally a good sign that mortgage rates are either going to drop even more, or stay low for longer.
So expect other mortgage lenders to step up with similarly strong pricing, especially since mortgage rates just hit their 14th record low of the year today!
About the Author: Colin Robertson
Before creating this blog, Colin worked as an account executive for a wholesale mortgage lender in Los Angeles. He has been writing passionately about mortgages for nearly 15 years.