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Mount Savage: A quiet mountain town

Mount Savage was once a booming industrial hub, but is now a quiet mountain town perfect for families and lovers of history, especially those interested in classic architectural. What was once a transportation mecca, Mount Savage is now a place where cars are needed, especially to find employment in nearby cities, but this has led to a low cost of living and, thus, very low mortgage rates for buyers as well as low prices for renters.

Mount Savage is an affordable historical town

The cost of living in Mount Savage is remarkably low

Mount Savage, MD, is a extremely affordable town to live in. The median home price is roughly $90,500—which is a whopping 69 percent lower than the Maryland average price. It's clear to see why 85 percent of the residents of Mount Savage are homeowners—that’s 27 percent higher than in the rest of Maryland. On average, an estimate of 3.3 percent APR on a 30-year fixed mortgage, monthly mortgage payments are just under $1,200. If you're planning to purchase a home in Mount Savage, it’s important to understand the culture in the area. Transportation is key especially when looking for employment, as most people commute from the city. Earnest can help you best understand your needs and financial assets while purchasing your new home.

Low living costs and high historical value

Mount Savage is the perfect place for history lovers on a fixed budget

Mount Savage has a population of just under 800, but at one point in time it was actually the fifth largest city in Maryland. It was a booming industrial center for many years and became a cultural melting pot, attracting people from all over the world, England, Ireland, Scotland and Germany specifically. However, over time the industries vacated Mount Savage and the railroad ceased operation, causing a drop in employment and, as a result, in the overall population. Due to the low population and lack of jobs, the cost of living in Mount Savage is incredibly low, with much lower mortgage rates than the national average. The average mortgage payments are just under $1,200 a month. Let Earnest help you find the perfect home at a price you can afford.

Common Questions About Mount Savage Mortgage Rates

All The Answers You Need to Settle Down Sooner

Should I choose a fixed or adjustable rate?

It depends how long you expect to stay in the home. Adjustable rates are good for people who may not be in the home long, whereas fixed rates are ideal for people who are confident of settling in.

Do I need a home appraisal?

Probably—in most cases, the homebuyer must use an appraiser to evaluate the value of the home. Appraisal costs vary depending on the value of the property, as well as the state the house is in. Buyers cannot choose their own appraiser—the bank makes the decision.

What is PMI?

Private mortgage insurance (PMI) is required when a homebuyer makes a down payment of less than 20%, or when a borrower refinances with less than 20% equity in the home. PMI fees vary according to your down payment and credit score, and adds a premium to your monthly mortgage payment. Please note, PMI is tax-deductible in 2015 and 2016 for certain income brackets.

What does Loan-to-Value mean?

Loan-to-Value (LTV) is the percentage of your home’s value that your loan represents. When refinancing, the calculation is simply the loan amount divided by the appraised value. When buying a home, the LTV is found by dividing by either the purchase price or appraised amount, whichever is lower. When the LTV is less than 80%, the lender generally requires PMI.

For example:

Purchase price: $100,000
Down payment: $15,000
Loan amount: $85,000
Appraised value: $110,000
LTV: $85,000/$100,000 = 85%

What are closing costs?

Closing costs are standard fees associated with a real estate transaction. You will typically pay about 2-5% of the purchase price in closing costs—the exact amount depends on where you are buying (or refinancing), as well as number of extra fees involved in your particular transaction. Earnest charges no lender fees, so the borrower is only responsible for 3rd-party fees.

What should I consider before refinancing my mortgage?

Refinancing your home loan is an attractive option when rates are low. A simple rate and term refinance can help you lower your monthly payment and potentially eliminate your PMI premium, as long as you have built up enough equity in the home. You might also use a cash-out refinance to access some of the equity you’ve built up in the home (which may result in a higher monthly payment on your new loan).

However, keep in mind that refinancing a mortgage does involve several fees (closing costs). Before refinancing, you should calculate the ‘break-even’ point at which your refinanced loan makes up for the closing costs. If you plan to leave your home before this time, it’s better to stay with your current mortgage.

Knowledge Is (Buying) Power

Further Resources from the Earnest Blog

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