Arkansas has lower-than-average home prices and low mortgage rates, making this state a prime location for buying cheap property. The state also offers several programs that can help qualifying homebuyers lower their rates.
Current Arkansas Mortgage and Refinance Rates
Compare today’s average mortgage rates in the state of Arkansas, based on an aggregated pool of rates from multiple sources.
|Product||Rate||Rate Last Week|
|30-Year Fixed Rate||2.910%||2.960%|
|15-Year Fixed Rate||2.540%||2.520%|
|5/1 ARM Rate||2.500%||2.500%|
|30-Year Jumbo Mortgage Rate||2.840%||3.000%|
|30-Year Fixed Refinance Rate||3.220%||3.140%|
Rates data based on Jonesboro, Arkansas as of 10/23/2020
Mortgage Rates Trends
In this graph:
On , the APR was for the 30-year fixed rate, for the 15-year fixed rate, and for the 5/1 adjustable-rate mortgage rate. These rates are updated almost every day based on Bankrate’s national survey of mortgage lenders. Toggle between the three rates on the graph and compare today’s rates to what they looked like in the past days.
Note: Not sure how much house you can afford? Use our mortgage calculator to find out.
Just a few months ago, Arkansas has nearly the highest mortgage rates in the United States, but the recent national drop in mortgage rates knocked the rates down in Arkansas to at or near 3% — which is incredibly low for any state. The home prices tend to be much lower than average in Arkansas, too, which means that the combination of low interest rates and cheap home prices could equate to a steal for you.
And there’s even more good news. From March 2019 to April 2020, Zillow reports home values in Arkansas appreciated 3.8%, meaning that if you buy a home in Arkansas, it may be worth more than you paid in just a couple of years. Home prices have steadily been increasing since 2012 in the state.
Plus, the United States Census Bureau reports the population in Arkansas has grown 3.5% from 2010 to 2019. If people continue to move to Arkansas and home prices keep increasing, that could provide an advantage to future sellers who buy now.
Getting a mortgage in Arkansas
Getting a mortgage in Arkansas involves a similar process compared to most states. According to the Arkansas Development Finance Authority (ADFA), you’ll likely need proof of income, a list of all current debts and information on your assets, including bank statements, investment records and retirement account statements.
According to a search of Arkansas homes in May 2020 on Zillow, there were 24,808 homes listed for sale. With lots of programs designed to help first time and low-to-moderate income buyers in Arkansas, there are plenty of opportunities to purchase affordable housing in the state.
- Median home price: $123,300
- Average 30-year fixed rate: 3.75%
- Median monthly mortgage cost: $1,071
- Homeownership rate: 65.7%
Arkansas state mortgage rate trends
Arkansas state mortgage rates were, at one point in the recent past, close to the highest out of all states in the U.S. — at least since 2019. A 2019 report found the average mortgage rate in Arkansas was 4.92%. The only two states with higher rates were Iowa at 4.93% and New York at 4.96%. California, the state with the lowest average mortgage rate, was at 4.74%.
However, the pandemic has caused mortgage rates within Arkansas to take a tumble downward. These rates are now at a two-year low, like most of the country’s mortgage rates. The average 30-year fixed rate has dropped at least 1.4% since mid-2018, a trend that’s help to make homeownership a better possibility for the state’s residents.
Arkansas state current mortgage rates
As of Aug. 10, 2020, Arkansas 30-year mortgage rates had dropped to 3.01%, which is the lowest rates have been since 1971. For context, take a look at the May 2019 rates, which were 4.14%. Like mortgage rates across the country, Arkansas home loan rates have reached historic lows due to the COVID-19 pandemic. That makes this a great opportunity for first-time homebuyers to enter the Arkansas home market — or for current homeowners to refinance to lower rates.
Other types of mortgage rates dropped in Aug. 2020 as well, which gives Arkansas homebuyers a bit of flexibility. The average rate on the 15-year fixed-rate mortgage dropped to 2.60% for the week of Aug. 10, compared to 3.6% in May 2019. The 5/1 adjustable-rate mortgage average was at 3.22%, compared to 3.68% in May 2019.
Most and least expensive places to live in Arkansas
Arkansas has 75 counties. Generally, counties with smaller populations tend to be less expensive to live in, while counties with the biggest cities in Arkansas tend to be more expensive. Washington County, the second-to-last affordable county in terms of cost of living, is home to Fayetteville, the third-largest city in Arkansas. Niche.com reports the median home value in Washington County is $167,600, well above the state’s average home value. In Benton County, the median home value was $193,647 in 2019.
Lafayette County, the county with the lowest cost of living according to Niche.com, is home to 6,915 people and has a median home value of $63,300. Little River County, another county with a low cost of living, has 12,417 people and a median home value of $72,200.
- Benton County: $172,000 is the 2020 median home value.
- Washington County: $167,600 is the 2020 median home value.
- Pulaski County: $153,700 is the 2020 median home value.
- Garland County: $138,400 is the 2020 median home value.
- White County: $121,300 is the 2020 median home value.
- Lafayette County: $63,300 is the 2020 median home value.
- Calhoun County: $69,400 is the 2020 median home value.
- Little River County: $72,200 is the 2020 median home value.
- Lincoln County: $74,400 is the 2020 median home value.
- Sevier County: $79,200 is the 2020 median home value.
Arkansas state mortgage resources and intricacies
The ADFA has several programs for homebuyers to help cut down costs on housing. With the ADFA Down Payment Assistance Program, homebuyers can secure $1,000 to $10,000 for their down payment and closing costs through participating lenders.
With the ADFA Move-Up Loan Program, homebuyers may be able to combine an affordable mortgage with additional ADFA single-family home buying programs, like the ADFA Down Payment Assistance Program and the Arkansas Dream Down Payment Initiative (ADDI). With the ADDI, lower-income home purchasers in Arkansas may qualify for a second mortgage loan for up to 10%, or up to $10,000, of the purchase amount of their home.
The ADFA Mortgage Credit Certificate is a dollar-for-dollar tax credit for first-time, low-to-moderate income home purchasers for up to 50% of the mortgage interest that’s paid each year, up to $2,000 a year.
Arkansas has some of the lowest property taxes in the country according to 2019 data, with less expensive property taxes than 41 other states. The average real estate tax rate in Arkansas is 0.63%, compared to 2.03% in Illinois and 2.16% in New Jersey, the two states with the highest property taxes.
The mortgage and refinancing application processes in Arkansas are similar to other states across the country. Lenders will look at your debt-to-income ratio when determining approval and rates.
The final word
While Arkansas mortgage rates were once among the highest across the country, the rates in this state are currently hovering near all-time lows. With home prices that are less in Arkansas compared to the national average, it’s possible to get lower-cost real estate with super low rates at this time in Arkansas. Look into interest rate lowering programs and other homebuying initiatives to help lower costs even further.