Understanding Interest Rates on A Mortgage

Are you in the midst of deciding whether to buy a new home or wait for interest rates to come down? It's a common dilemma that many potential homeowners face. With interest rates currently up at 7%, you may be wondering if it's wise to hold off and hope they decrease in the future. But what if we told you there might be another option? In this blog post, we'll explore whether buying now and potentially refinancing later is a smart move, or if waiting it out is the better choice. So sit back, relax, and let's dive into the world of mortgage interest rates!

Interest rates are up at 6 to 7% should I wait for decrease to buy?

If you've been keeping an eye on the housing market, you may have noticed that interest rates are currently at 7%. This might make you question whether it's a good time to buy or if waiting for rates to come down is a better option. While it's true that interest rates fluctuate and there's always a chance they could decrease in the future, there are a few things to consider.

Predicting when interest rates will drop is no easy task. Even financial experts struggle with this. It's like trying to predict the weather – sometimes you get it right, but often it can be unpredictable. So waiting around indefinitely for lower rates might not be the best strategy.

Even if interest rates do go down in the future, there's no guarantee they'll drop significantly.  But a couple of points could make  
substantial impact on your mortgage payments . 

While buying now means locking in at higher interest rates, it also puts you in a good position if rates continue to rise. By securing your mortgage at 7%, you're protected from any potential increases in the future. So may be wise to lock in your rate now and if they go up while looking at property you will still be at that rate.

Another consideration is that when rates were significantly lower there were multiple offers on properties  causing buyers to over pay and now there are fewer buyers in the market. That may give you more leverage to negotiate a better price on a home.

 Plus, the longer you wait, the more you'll be paying in rent and potentially missing out on building equity in a home.

Deciding whether to wait or buy now comes down to weighing these factors against your personal circumstances and financial goals. It may be worth exploring other options such as refinancing later if interest rates do decrease significantly. But remember that timing the market perfectly is nearly impossible – so don't let fear of missing out hold you back from making one of life's biggest investments! So even if you end up with a slightly higher interest rate, you may have saved money on the purchase price of your home.

Contact us with any questions or to get started. Dennis Lindsay

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