Overview of Washington Mortgages
Washington State is a unique combination of striking nature, a thriving arts culture and powerful industry that makes it a desirable location to own a home. Washington’s mortgage rates have been lower than national average rates for the past decade and beyond. County-level conforming and FHA loan limits are mostly standard, with some higher exceptions.
|30 year fixed||3.00%||2.93%||+0.07|
|15 year fixed||2.28%||2.22%||+0.06|
|30 yr fixed mtg refi||2.97%||2.89%||+0.08|
|15 yr fixed mtg refi||2.28%||2.20%||+0.08|
|7/1 ARM refi||2.21%||2.21%||0.00|
|15 yr jumbo fixed mtg refi||3.17%||3.13%||+0.04|
National Mortgage Rates
Historical Mortgage Rates in Washington
Washington Mortgage Rates Quick Facts
- Median Home Value: $387,600 (U.S. Census Bureau)
- Loan Funding Rate: 57.74% (CFPB)
- Homeownership Rate: 63.8% (St. Louis Fed)
- Median Monthly Homeownership Costs: $1,886 (U.S. Census Bureau)
Washington is a beautiful Northwestern state with scenic natural expanses and mild weather. While it can be rainy, it's a great state to explore. Washington mortgage rates have historically been lower than the national average.
A financial advisor in Washington can help you plan for the homebuying process. Financial advisors can also help with investing and financial planning - including tax, retirement and estate planning - to make sure you are preparing for the future.
Washington Historic Mortgage Rates*
|Year||Washington Rate||U.S. Rate|
*The FHFA stopped reporting new data in 2018.
Washington Mortgages Overview
Homes in the Evergreen State are pricier than in many other parts of the U.S. The median home value in Washington State is $387,600, which is roughly $140,000 higher than the national median. Before you start shopping for rates and looking at homes, you’ll want to figure out your monthly mortgage payment budget.
Most Washington county conforming limits are at the standard limit of $548,250. King, Pierce and Snohomish counties jump up to $776,250, though. FHA loan limits across the state are varied. Many counties are at the average limit of $356,362, but others go as high as $776,250.
Conforming and FHA Loan Limits by County
|County||Conforming Limit||FHA Limit|
Washington homebuyers will receive deeds of trust as opposed to actual mortgages. One of the major differences between the two is how foreclosures are handled. Lenders who issue deeds of trust do not have to go to court to foreclose on the home that the loan applies to. Instead the lender can initiate a “power of sale” foreclosure by hiring a third party to auction the home it wants to foreclose.
Sellers in the Evergreen State don’t have much leeway when it comes to home disclosures. Washington provides a disclosure form for sellers to fill out, complete with a long list of specific “yes” or “no” questions. These questions cover topics like the quality of the plumbing, whether there are any liens on the property and even how close the property resides to a farm.
In this case, buyers will receive a great deal of information about the home, but it is still important to order a home inspection. Home inspections aren’t required, but they go a long way in making buyers feel secure that they are not purchasing a property that will turn into a major money pit.
30-Year Fixed Mortgage Rates in Washington
If you are hoping to buy a forever home, a 30-year fixed-rate mortgage may be the best option for you. It’s the most common home loan option as buyers know what to expect for the entirety of the loan’s duration. Interest rates and monthly payments remain constant for the entire three decades a buyer has to pay off the loan, unless they’ve made mortgage prepayments or decide to refinance.
The average Washington rate for a fixed 30-year mortgage is 2.63% (Zillow, Jan. 2021).
Washington Jumbo Loan Rates
“Conforming” or standard loans are those that follow the conforming loan limit set by each county. These loans can be re-sold on the secondary mortgage market and qualify for normal interest rates. If you take out a home loan that exceeds that county’s particular limit, you will have what is known as a “jumbo loan.” In most of the country and most of Washington state that limit is $548,250, meaning if you take out a home loan that’s bigger than that, you have a jumbo loan which will be accompanied by a higher interest rate.
In three Washington counties (King, Pierce and Snohomish), the conforming loan limits are higher. Buyers in these areas have a little more leeway to take out larger loans before they are considered jumbo loans and are subject to high interest.
The average 30-year fixed jumbo loan rate in Washington is 2.57% (Zillow, Jan. 2021).
Washington ARM Loan Rates
Some buyers may elect to get an adjustable-rate mortgage, or ARM, instead of a fixed-rate mortgage. An ARM offers a low interest rate for a set period of time between one and 10 years, depending on the terms of the loan. Once that introductory period ends, the rate can change (adjust) once a year. It will usually go up. It is important to pay close attention to an ARM’s terms which will lay out how many times the interest rate can change as well as the highest possible level that it can reach. Before you decide to take out an ARM to purchase your dream house, you should make sure that the interest rate cap is one that you can comfortably afford to pay.
The average rate for a 5/1 ARM in Washington is 2.94% (Zillow, Jan. 2021).
Washington Mortgage Resources
Need assistance buying a house in the Evergreen State? There are resources can help you achieve your dream of buying a home.
The Washington State Housing Finance Commission offers a few different programs aimed at helping residents purchase a home. Some of these include:
- Home Advantage Program, which offers affordable loans to eligible buyers who attend a Homebuyer Education seminar and meet certain income limits.
- HomeChoice Program, which provides up to $15,000 in downpayment assistance for qualified buyers who have a disability or live with a family member who has a disability.
- House Key Opportunity, which gives first-time homebuyers the chance to secure an affordable, low-rate mortgage.
- Mortgage Credit Certificate, which is a tax credit program that helps put more money in buyers’ pockets so that they can more easily afford a house payment.
The Washington Homeownership Resource Center is a fantastic resource for anyone purchasing a home in the state. Its main purpose is to direct homebuyers to the courses, programs and financial assistance opportunities that will best suit them in their homebuying process.
|Resource||Problem or Issue||Who Qualifies|
|Washington State Housing Finance Commission||Offers affordable loans, down payment assistance and tax credit programs to help fund home purchases in the state.||Some applicants must be first-time homebuyers; there are also income limits and benefits for buyers purchasing in targeted areas.|
|Washington Homeownership Resource Center||Helps educate Washington homebuyers in finding the programs that best suit them; helps educate homeowners on preventing foreclosures.||Any Washington homebuyer looking for housing resources.|
|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.|
Residents of rural Washington may also be eligible for loans and grants from the U.S. Department of Agriculture to put toward purchasing a new home or repairing a current house.
Washington Mortgage Taxes
If you’re purchasing or selling a home in Washington, be aware that there are transfer taxes on real estate transactions. There is a real estate excise tax (REET) with rates that vary from 1.1% to 3% depending on the value of the sale. There are also local tax rates, which range from 0.25% to 0.75%. In Washington, the seller generally pays these fees, but the buyer has the option to cover them.
Homeowners across the country are allowed to deduct the mortgage interest they pay from their taxable income when they file their federal tax return.
Washington Mortgage Refinance
When it comes to refinancing, Washington residents can easily look to multiple lenders for refinance loans. A federal alternative is the High Loan-to-Value Refinance Option from Fannie Mae. These came about due to the cancellation of the Home Affordable Refinance Program (HARP) in late 2018.
Best Places To Get A Mortgage
SmartAsset’s interactive map highlights the best counties in the U.S. (and in each state) for securing a home mortgage. Hover over states and counties to see rankings and data points for each region, or use the map’s tabs to view the top counties for each of the factors included in our analysis.
Methodology In order to determine the best places in the country to get a mortgage, our study compared four factors, including overall borrowing costs, likelihood of securing a mortgage, property taxes and annual mortgage payments.
To calculate the overall borrowing costs, we analyzed the expected costs throughout the first five years for 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 mortgage originations (secured mortgages) in each county. Annual mortgage payments are a measure of 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, 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 2018 5-Year American Community Survey, Informa, Bankrate, government websites, SmartAsset