Home prices in South Dakota, especially in Rapid City and Sioux Falls, have declined over the past few years making it a good market to buy a new home. There are several state agencies in South Dakota that can help you secure a low-interest mortgage whether you are a first-time buyer or existing homeowner. Because the state is one of the least populated in the country, lenders are currently offering some of the best mortgages in the country. The South Dakota Housing Development Authority is currently offering 30 year fixed mortgages for 4.75% - one of the most competitive in the country. They also offer subsidies for down payments and closing costs for first-time buyers.

Perhaps the most frustrating part about buying a new house is securing a good mortgage. The majority of people can’t simply write a check for the price of their new house. They need to borrow. There are a wide variety mortgages out there to help you secure the financing you need to buy a new home.

A 30 year fixed mortgage, which has a fixed interest rate, is a type of mortgage loan that is repaid by the borrower making 360 equal monthly payments over a period of 30 years. Since the borrower's payments are 'fixed', the borrower can expect to make the same monthly payment for the entire term of the loan. A 30 year mortgage loan is the most widely accepted program used to finance a residential purchase.

Another type of mortgage is one where the interest rate changes over the term of the loan depending on the prevailing interest rate. An Adjustable Rate Mortgage (ARM) is a mortgage loan that is most widely known for its low starting interest rate (when compared to the 30 & 15 year mortgage loans). This 'low' introductory rate is used to calculate the mortgage payment for a specified period of time. Once this introductory period is over, the interest rate is adjusted periodically the yield on the one-year Treasury Bill.

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