Are Interest Rates Killing Your Dream?

If you or anyone you know who is either looking to purchase their first home, or to sell their current home and relocate, they are likely frustrated by the continuing rise in interest rate. There's no way around it, rates in the past two months are WAY up, nearly two full percentage points, from around 5% in late July to over 7% in late September. It's hard to know where rates will go from here...higher, lower, or stay about where they are. However, if you or someone you know is looking to finance a purchase, there are a few strategies that may help lower the rate shock: (1) Interest on FHA loans are typically between 0.50-0.75% lower than a conventional loan. If you qualify (which isn't difficult), you can put as little as 3.5% down and get a lower interest rate because part of the rate is factored into the loan amount. (2) With the market softening significantly, sellers are lowering asking prices and are often willing to pay for rate "buydowns." Buyers can ask the seller for a "rebate" on the price of the home, then use that money to "buy down" the interest rate. The higher the buydown, the lower the rate. We've seen rate buydowns as high as $10k-$15k, which can significantly lower the interest rate, thus your monthly payment. These are just two of the ways that buyers are getting financed in this high rate environment. There are others not mentioned here that may fit your circumstances. Contact me to review all the options and see which one best fits your situation.