Mortgage rates are climbing. Here’s how to get the lowest one you can.
Mortgage rates have been on a tumultuous path, rising from pandemic-era record lows to two-decade highs in just a few short years. High rates are exacerbating an already challenging market thanks to rising home prices and stubbornly high inflation.
Pausing your home search isn’t the only option, though. Since mortgage rates vary by lender—not to mention by borrower—there are several ways you can reduce your rate and, subsequently, your monthly payment. Here’s what experts say to do to get the best possible mortgage rate.One of the biggest downsides to higher mortgage rates is that they squeeze your budget—allowing you to borrow less for the same monthly payment you could have a few months ago.
According to Freddie Mac, borrowers who get two rate quotes reduce their rate by an average 0.20 percentage points—for example from 7.5% to 7.3%—saving about $600 annually. If you get four quotes, that reduction jumps to 0.40 points or $1,200 in annual savings. Once you apply with each lender, you should receive a loan estimate form. You can use this to compare the companies’ rates, loan fees and closing costs. In this rate environment, you also might want to consider any future refinancing offers. Because mortgage rates are so high, some lenders have started offeringif rates drop within the next few years. This might be something to look for if your initial rate is higher than you would like., but that doesn’t mean you have to.
This will save you money over time, but take note: Fifteen-year mortgages come with significantly higher monthly payments, as you’re spreading the loan balance across fewer years. Still, Whitehead says, “The 15-year is a great choice if you have no other debt and can afford the payments. You’ll save an incredible amount of money on interest.”Buying mortgage points—sometimes called a “mortgage rate buy-down”—is another way to snag yourself a lower interest rate.
Once you lock your rate, keep in mind: Time is of the essence. If you don’t close before your rate lock expires, you’ll get a new interest rate based on current market conditions—and it could be much higher than the one you were originally offered.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
With interest rates paused, should you lock in a mortgage rate now?Interest rates are on pause — for now. Should homebuyers lock in today's mortgage rates or are they better off waiting?
Read more »
Demand for adjustable-rate mortgages jump 10% as U.S. mortgage rates stay stubbornly highAarthi Swaminathan is a MarketWatch personal finance reporter.
Read more »
Here's what to do if you get behind on mortgage paymentsMortgage delinquency rates have gone down slightly this year, but for those homeowners who are struggling, here are tools and tips that may help you get out of a rut.
Read more »
Bank of Canada's Rogers urges shift by banks on mortgage lending -Bloomberg NewsBank of Canada's Rogers urges shift by banks on mortgage lending -Bloomberg News
Read more »
Looking for a 4% mortgage? Here's where home buyers can find one.Incentives like mortgage buydowns and price cuts on homes are out there.
Read more »
Solo Stove Fire Pits Are on Sale for the Lowest Prices of the Year Right NowShop discounts on Solo Stove fire pits, camp stoves, and accessories during the Black Friday sale.
Read more »