Overview of Louisiana Mortgages
Louisiana is a multicultural state rich in history. In terms of population, Louisiana is right in the middle, coming in at 25th for the nation. In terms of mortgages, Louisiana rates have traditionally stuck close to the national average.
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Louisiana Mortgage Rates Quick Facts
Historical Mortgage Rates in Louisiana
Louisiana is renowned for its spicy cuisine, bayous and New Orleans’ French Quarter. The Pelican State’s mortgage rates are typically close to the national average. Current 2016 Louisiana mortgage rates are slightly below the national average.
Louisiana Historic Mortgage Rates
|Year||Louisiana Rate||U.S. Rate|
Louisiana Mortgages Overview
Whether you are looking to become a resident of Metairie or settle down in the capital city of Baton Rouge, you should determine a budget as you begin your real estate search. You may also want to look into getting mortgage preapproval from a lender as it will streamline the process of securing a home.
Louisiana Mortgage Rates
|Percentage of Homes||95.00%|
|Average Property Value||$101,686.37|
|Percentage of Homes||2.70%|
|Average Property Value||$106,705.17|
|Percentage of Homes||1.20%|
|Average Property Value||$134,113.75|
|Percentage of Homes||1.20%|
|Average Property Value||$75,423.80|
The conforming limit for every Louisiana county is at the standard $417,000. The FHA loan limits are also uniform at $271,050. This indicates that, overall, homes in the Bayou State are not exorbitantly expensive.
Conforming and FHA Loan Limits by County
|County||Conforming Limit||FHA Limit|
|East Baton Rouge||$417,000||$271,050|
|St John The Baptist||$417,000||$271,050|
|West Baton Rouge||$417,000||$271,050|
Disclosure laws in Louisiana require that sellers disclose the physical condition of the home, as well as any defects. Regardless, a home inspection is still the best way to feel confident in a property purchase. A quality home inspection will help you know you’re not about to move into a major money pit.
30-Year Fixed Mortgage Rates in Louisiana
If you are looking to become a homeowner in the Bayou State, you will want to look into a 30-year fixed-rate mortgage. This a reliable home loan option as you have three decades to pay off your mortgage (unless you refinance). Furthermore because your interest rate will remain the same for the duration of the loan, you know exactly how much your monthly payments will be (again, unless you decide to refinance). You may also want to consider a 15-year fixed-rate mortgage which will allow you to pay off your loan faster and has a lower interest rate, but keep in mind your monthly payments will be higher with this option.
The average Louisiana mortgage rate for fixed-rate 30-year mortgages is 4.17%.
Louisiana Jumbo Loan Rates
Every county in Louisiana has the standard conforming loan limit of $417,000. Conforming loans (those that are $417,000 or lower) can be re-sold on the secondary mortgage market and qualify for standard interest rates. If you need to take out a home loan in Louisiana that is bigger than $417,000, it will be considered a “jumbo loan.” You should be aware that jumbo loans are accompanied by higher interest rates.
Lenders consider jumbo loans to be riskier than conforming loans because more money is on the line. The higher interest rates are meant to compensate for that additional risk. The average jumbo loan rate in Louisiana is 3.88%.
Louisiana ARM Loan Rates
An adjustable-rate mortgage (ARM) stands in contrast to a fixed-rate mortgage in the sense that the interest rate can change over the life of the loan. Usually an ARM will come with a lower interest rate for an introductory period that lasts somewhere between one and 10 years. After that initial period, the interest rate can go up or down, though it will generally increase.
If you are considering an ARM, you should know that the loan’s terms will spell out how many times the interest rate can change and the highest possible rate it can reach. So it’s a wise idea to assess whether the maximum potential interest rate is one that you can afford.
The average rate for an ARM in Louisiana is 3.56%.
Louisiana Mortgage Resources
Do you need assistance purchasing a Louisiana home? There are resources out there to help you in your mortgage process.
The City-Parish Office of Community Development (OCD) Homebuyer Assistance Program (HAP) offers eligible homebuyers funds to help them secure or repair a first home. This program also applies for displaced homemakers or single parents.
The Louisiana Recovery Authority focuses on rehabilitating storm-impacted areas of the state through homebuyer support. Its programs include:
- First-time homebuyers program -- Offers funds to homebuyers in Orleans and St. Bernard parishes to cover down payments, closing costs and mortgage financing.
- Soft Second Homebuyers Program -- Offers assistance for low-to-moderate income individuals buying their first home in one of the 13 hurricane-impacted parishes. The program partners with local officials to promote revitalization in critical areas throughout the Louisiana Gulf Coast.
- Long Term Community Recovery Homeowners Program -- Provides assistance for low-to-moderate income buyers in the city of New Orleans who are purchasing their first home or rehabilitating their current homes.
|Resource||Problem or Issue||Who Qualifies||Website|
|The City-Parish Office of Community Development (OCD) Homebuyer Assistance Program (HAP)||Offers funding for first-time homebuyers who qualify.||Buyers must not have owned a home in the last 3 years or qualify as a displaced homemaker or a single parent.||https://brgov.com/dept/ocd/housing/hap.htm|
|State of Louisiana Division of Administration - Office of Community Development (Louisiana Recovery Act)||Administers federal grants for units of general local government to further develop storm impacted communities inhabited low to moderate income families.||Units of local government and nonprofit organizations in federally designated areas of the state.||http://www.doa.la.gov/Pages/ocd/Index.aspx|
|USDA Rural Development - Single family loans||Offers payment assistance to increase an applicant’s repayment ability.||Applicants must be without decent, safe and sanitary housing; Be unable to obtain a loan from other resources on terms and conditions that can reasonably be expected to meet; Agree to occupy the property as your primary residence; Have the legal capacity to incur a loan obligation; Meet citizenship or eligible noncitizen requirements; Not be suspended or debarred from participation in federal programs.||http://www.rd.usda.gov/programs-services/all-programs/single-family-housing-programs|
|Home Affordable Refinance Program||Refinancing for eligible borrowers.||Single family homes and condos that fit within lending loan limits.||http://www.harp.gov/|
The United States Department of Agriculture Rural Development offers programs to develop rural communities in Louisiana by providing aid for affordable housing for residents. Loans and grants are available for people hoping to buy a home.
Louisiana Mortgage Taxes
Homeowners who itemize their deductions when they file federal income taxes are allowed to deduct the mortgage interest they pay from their taxable income. In Louisiana, homeowners can include that deduction on their state income taxes as well.
Also note that unlike some other states, Louisiana does not charge real estate transfer taxes which is a nice bonus for homebuyers here.
Louisiana Mortgage Refinance
If you’ve decided it’s time for you to refinance, remember that you are not obligated to continue working with the lender who issued your current mortgage (though of course you can). Be aware that you are free to shop around with other lenders and compare rates to find one that truly works for you.
You can also look into the Home Affordable Refinance Program of Louisiana which provides access to interest and principal payment reductions and low closing costs. The Louisiana HARP accepts single family homes and condos.
See Mortgage Rates in These Other States
Best Places To Get A Mortgage
SmartAsset’s interactive mortgage map highlights the best counties in the country (and in each state) for securing a mortgage. Hover over counties and states to see data points for each region, or use the map’s tabs to view the top counties for each of the factors driving our analysis.
Methodology For many people buying a house means securing a mortgage. To determine the best places in the country to get a mortgage we looked at four factors: overall borrowing costs, ease of securing a mortgage, cheap property taxes and cheap annual mortgage payments.
To calculate the overall borrowing costs, we looked at the expected costs over the first five years of a $200,000 mortgage with a 20% down payment, including closing costs. We calculated the ease of getting a mortgage as the ratio of mortgage applications to actual mortgage originations (secured mortgages) in each county. We based annual mortgage payments on the annual principal and interest payments for a $200,000 loan in that location, using average mortgage rates in each county.
Finally, we ranked locations based on these four factors, and then averaged those rankings, giving equal weight to each factor. The areas with the lowest average rankings are the best places to get a mortgage.
Sources: Mortgage Bankers Association, US Census Bureau 2015 5-Year American Community Survey, Informa, Bankrate, government websites, SmartAsset