What to know about North Dakota mortgage rates

Written by: Anna Baluch
• Updated •4 min read
This date may not reflect recent changes in individual terms.
The State Capital grounds in Bismark, North Dakota are home to the states legislature, which establishes North Dakota state tax laws.Image: The State Capital grounds in Bismark, North Dakota are home to the states legislature, which establishes North Dakota state tax laws.
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North Dakota offers diverse scenery, a beautiful national park and plenty of exciting outdoor activities like hiking, horseback riding and mountain biking. It’s no surprise that almost 800,000 people call it home.

If you’re searching for a home in North Dakota, remember to shop around and compare mortgage rates. What may seem like a small difference could add up to thousands over the course of a 15-year or 30-year mortgage.

Mortgage debt in North Dakota

Credit Karma members with mortgages in North Dakota had average mortgage debt of $182,707 in 2020, with average monthly mortgage payments of $1,306.

That puts North Dakota slightly below average for both mortgage debt and average monthly mortgage payments compared to Credit Karma members across the U.S. in 2020.

Types of home loans

If you choose to finance your dream home, you might be overwhelmed with the number of mortgage loan options out there. Here are some of the more common mortgage types North Dakota homeowners may consider.

Conventional loans in North Dakota

Conventional loans are mortgages that aren’t part of government programs. These loans tend to be good for people with solid credit and a down payment of at least 3% to 5%.

North Dakota FHA loans

FHA loans are a good option for first-time homebuyers to explore — particularly if your credit is less than perfect. That’s because you may be able to qualify with credit scores as low as 580 with a 3.5% down payment or 500 with a down payment of 10%. This FICO® score requirement is the FHA minimum standard. In general, additional lender credit score requirements may apply.

The FHA loan limit in 2023 is generally $472,030 for a one-unit property, but it can reach as high as $1,089,300 depending on where you live.

Every area in North Dakota conforms to the FHA loan limit of $356,362 in 2021.

You can find the exact limit by county on the U.S. Department of Housing and Urban Development website.

VA loans in North Dakota

If you’re an eligible veteran or service member comparing mortgage rates in North Dakota, a VA loan can be attractive since down payments and mortgage insurance aren’t typically required, and you may be able to qualify even if you don’t have great credit.

Similar to FHA loans, VA loans are insured by the government but issued by private lenders.

Conforming loan limits in North Dakota

Conforming loans are a type of home loan that meets certain loan limits set by the Federal Housing Finance Agency. This means they can be bought by Fannie Mae and Freddie Mac, federal-government-sponsored enterprises that guarantee mortgages.

Loans that exceed conforming loan limits are known as jumbo loans. Lenders often consider these loans riskier than conforming loans.

All of North Dakota’s counties have a conforming loan limit of $548,250 in 2021.

First-time homebuyer programs in North Dakota

If you’re hoping to buy your first home, there may be some assistance programs available to you in North Dakota.

  • FirstHome Program: Offered by the North Dakota Housing Finance Agency (NDHFA), the FirstHome program offers mortgages to first-time homebuyers through a network of participating lenders. To qualify, you must meet certain income and purchase price limits. You’ll also need to put at least $500 of your own money toward your home.
  • HomeAccess Program: This NDHFA program is geared toward single parents, veterans and people with family members who are older or have disabilities. HomeAccess loans can be used with down payment assistance loans offered by NDHFA in the form of second mortgages. To be eligible, you must meet certain income and purchase price limits and cover at least $500 of your home purchase with your own funds.
  • North Dakota Roots Program: If your income exceeds the limits of the FirstHome program, the Roots program through NDHFA may be an option. Income limits vary by county, and you must personally contribute a minimum of $500 toward the purchase of your home.

Mortgage refinancing rates in North Dakota

If you’re thinking about refinancing your mortgage, keep a few things in mind:

  • Break-even cost — Once you know the closing costs for your refinance, you can use any savings on your monthly mortgage payment to calculate how long it will take you to recoup that investment and “break even.”
  • Cash-out refinance — Have you accumulated equity in your home that you’d like to convert to cash? A cash-out refinance lets you refinance your home for more than what you owe and get cash in return. But you’ll owe the full amount plus interest and you’ll end up owning less equity in your home, which means less cash in your pocket if you sell in the future.
  • Loan term — You also may want to either shorten or extend your loan term. For instance, if you have a 30-year mortgage, you may want to convert it to a 15-year loan. Keep in mind that reducing your term likely means you’re paying more each month — but less in interest over time. Lengthening your loan term may mean you pay less each month, but more interest over the course of the mortgage.
About the author: Anna Baluch is a freelance personal finance writer from Cleveland, Ohio. You can find her work on sites like The Balance, Freedom Debt Relief, LendingTree and RateGenius. Anna has an MBA in marketing from Roosevelt Un… Read more.