Tag: #mortgagerate

Mortgage Rates Are Stabilizing

Over the past few years, affordability has been the biggest challenge for many homebuyers. Between home prices and mortgage rates, many have felt stuck between a rock and a hard place.

But the situation is getting better. While affordability is still tight, mortgage rates have shown signs of stabilizing in recent months.

Mortgage Rates Have Stabilized – For Now

Over the past year, mortgage rates have had their share of ups and downs, making it tough for buyers to know what to expect. But recently, rates have started to level out and have settled into a more narrow range (see graph below):

As the graph shows, rates have stayed within that half-percentage-point since late last year. Yes, there’s been movement within that range, but wild swings and sudden ups and downs just haven’t been the story lately. And that’s a bigger deal than you may realize. As HousingWire explains:

“Analysts, economists and mortgage professionals are coining this quarter’s activity as one of the most “calm” periods for mortgage rates in recent memory.”

How This Helps you

Let’s be real. Unpredictability makes it tough to plan ahead. When rates are bouncing around and making big jumps week to week, it’s easy to be intimidated. But with rates staying in a pretty steady range over the past several months, you have a clearer picture of what your potential monthly payment could look like. That makes moving feel less uncertain – and more doable.

So, you can start planning if you’ve decided that it’s time to make a change. Life goes on. Your home that is too small isn’t going to get any bigger. And it’s not going to shrink if it’s already too big.

Will This Stability Last?

According to the experts, it looks like that stability might hang around for a bit. Rates may come down ever so slightly in the months ahead, but it’ll likely be a slow and mild change. As Danielle Hale, Chief Economist at Realtor.com, says:

“I expect a generally downward trend for rates this year, but at a slow enough pace that it might not be noticeable in any given month.”

So, if you’ve been holding out for the perfect mortgage rate, the best advice is to avoid trying to time the market. It may not look terribly different than the opportunity you already have in front of you. As Jeff Ostrowski, Housing Market Analyst at Bankrate, explains:

“Trying to time mortgage rates is really difficult. There’s no guarantee that rates are going to be any more favorable in three months or six months.”

And if we look at the latest expert forecasts that go out a bit further, even those tell much of the same story. Two out of the three projections say rates will still likely be in the mid-6% range by the end of 2026 (see graph below):

This puts today’s buyers in a much better spot. As Sam Khater, Chief Economist at Freddie Mac, explains:

“Mortgage rates have moved within a narrow range for the past few months . . . Rate stability, improving inventory and slower house price growth are an encouraging combination . . .”

Just remember, mortgage rates are still going to react to changing economic conditions, inflation, and more – and that means they could shift again. But right now, you’ve got more predictability, and that means more opportunity, too. 

Remember: the rates you see quoted may not be the rate you could get. For example, Cape Cod Five is showing rates as low as 5.625% for a 15-year fixed rate mortgage. Your individual situation determines your rate.

Bottom Line

So, if you haven’t spoken with your mortgage lender in a while you might want to give him or her a call.

If you don’t have a relationship with a lender, we can recommend several whom we’ve worked with. You can find us at 508-388-1994 or msennott@todayrealestate.com. We’re happy to help…

Mari and Hank

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.

Real Estate Terms You Need to Know

If you’re a first-time homebuyer or maybe someone who hasn’t been in the market for a while, you maybe coming across some terms you’re not familiar with. And that can be overwhelming, especially while going through one of the biggest purchases of your life. 

The good news is you don’t need to be an expert on real estate jargon. That’s our job. But getting to know these basic terms will help you feel a lot more confident throughout the process.

Terms Every Homebuyer Should Know

Once you’re familiar with this terminology, you’ll have a better understanding of important details – from contracts to negotiations. So, when those big conversations happen, you’ll feel informed, in control, and able to make the best decision for your unique situation. As Redfin puts it:

“Having a basic understanding of important real estate concepts before you start the homebuying process will give you peace of mind now and could save you a fortune in the future.”

Here’s a breakdown of a few key real estate terms and definitions you should know, according to the Federal Trade Commission (FTC) and First American.

Appraisal: A report providing the estimated value of the home. Lenders rely on appraisals to determine a home’s value, so they’re not lending more than it’s worth.

Contingencies: Contract conditions that must be met, typically within a certain timeframe or by a specified date. For example, a home inspection is a common contingency. While you can waive these to try and make your offer more competitive, it’s generally not recommended.

Closing Costs: A collection of fees and payments made to the various parties involved in your home purchase. Ask your lender for a list of closing cost items, including attorney’s fees, taxes, title insurance, and more.

Down Payment: This varies by buyer, but is typically 3.5-20% of the purchase price of the home. There are even some 0% down programs available. Ask your lender for more information. Chances are, unless specified by your loan type of lender, you don’t need to put 20% down.

Escalation Clause: This is typically used in highly competitive markets. It’s an optional add on in a real estate contract that says a potential buyer is willing to raise an offer on a home if the seller receives a higher competing offer. The clause also includes how much a buyer is willing to pay over the highest offer.

Mortgage Rate: The interest rate you pay when you borrow money to buy a home. Consult a lender so you know how it can impact your monthly mortgage payment.

Pre-Approval Letter: A letter from a lender that shows what they’re willing to lend you for your home loan. This, plus an understanding of your savings, can help you decide on your target price range. Getting this from a lender should be one of your first steps in the homebuying process, before you even start browsing homes online.

Bottom Line

You don’t need to have all these terms memorized, but a little knowledge goes a long way. Brushing up on the basics now means fewer surprises later – and more clarity when you buy a home. 

What unfamiliar real estate term or phrase have you come across that wasn’t on this list?

Let’s connect at 508-388-1994 0r msennott@todayrealestate.com and talk it through so you will have a solid understanding of what it means and where it may show up in the homebuying process. 

Mari and Hank

The information contained, and the opinions expressed, in this article are not intended to be construed as investment advice. You should always conduct your own research and due diligence and obtain professional advice before making any investment decision.