If you’re looking for the best moment to jump into the market and buy a home, you likely have your full attention on mortgage interest rates. As the rates dipped lower and lower all throughout 2020, there was seemingly no end in sight, leaving you asking, “Will that trend continue through 2021?” The fact is, no one truly knows and waiting it out could prove quite a gamble. By cutting to the chase and not waiting any longer for lower interest rates to buy a home, here’s how you could win.
Lock in Record Low Rates
At this moment, interest rates are low for a 10-year fixed-rate conventional mortgage. Want up to 30 years to pay off your home? You can lock in a low-interest rate for that mortgage term too. Need to know how low of an interest rate you qualify for? Click here to find out.
Even lower interest rates are unlikely to come in the near future since they’ve already started increasing in the past few months. In fact, if the economy starts to recover through 2021, interest rates are sure to rise as will competition in the housing market.
So, don’t hesitate to jump at the opportunity to lock in the current rates, which will allow you to keep your overall cost of buying a home as low as possible. With the low rates on your side, you’ll secure a low mortgage payment that allows you to throw more at the principle over time, helping you potentially pay off your loan faster than ever.
Avoid Ultra-Low Housing Inventory
Low mortgage interest rates often result in minimal housing inventory, especially in regions popular with homebuyers. No matter what happens with those rates, your best opportunity to find the house of your dreams could be right now.
Housing inventory is already set to dry up as the spring buying season rolls around, after all. Beyond that, if the interest rate drops lower when that happens, it’ll be difficult to find homes that meet your needs.
Even if you do, the low inventory could result in bidding wars that increase the going price, causing you to spend more money than you would have at a higher interest rate. You may also spend a whole lot of money digging through the options and putting in offers, only to get outbid in a second.
Avoid a Quick Market Turnaround
The real estate market can change in an instant, leaving you wishing you would have decided to buy a home sooner. Whether you’re looking at rising interest rates or quickly depleting housing inventories, once the changes begin, there’s nothing you can do to stop it.
All you can do is hop into the market as soon as possible to take advantage of the already low interest rates. Even if the rates continue to fall a bit, you’ll likely come out a winner in the end. You won’t have to fight as much over low housing inventory or lose sleep tossing and turning in worry about rates suddenly spiking up.
How to Take Advantage of the Current Low Interest Rates
As you consider the current mortgage interest rates, ask yourself if you could benefit from a lower interest rate on your current home loan, take cash out or both. Also, ask yourself if now would be a good time to buy a bew home and lock-in a great interest rate. If the answer is a resounding yes, get in touch with to get your questions answered and start the application process. You’ll want to be fully informed, so you can see all their terms for your mortgage needs.
While waiting for that coveted pre-approval letter, don’t be afraid to start browsing the real estate available in your target area. As you prepare to put in an offer on a property, you can get an idea of what houses are in your budget range and adjust your expectations. Then, once you get your funding in order, you can dive right into the home buying process in earnest.