The 3 best ways to take advantage of today’s historically low interest rates
Mortgage interest rates were already hovering around 3 year historical lows when ‘Brexit’( Britain’s exit from the European Union) caused rates to drop even lower, and into all-time lows! That’s right, rates are near all-time lows, and more potential homebuyers and homeowners are beginning to take notice. Why? Simply because, the lower the interest rate, the lower a monthly mortgage payment can be; meaning, more money in a homeowner’s pocket at the end of each month. If you’re currently a renter on the fence about being a homeowner, or if you are already a homeowner, here are the 3 biggest ways to take advantage of today’s low interest rates:
1. Become a homeowner
If you’ve been considering homeownership for some time and have been watching the interest rates, but have your heart set on a perfect rate to appear, you may be waiting for something that’ll never happen. For as educated as a guess may be, no one can predict future interest rates and with rates in the low 3s in some areas, your time to become a homeowner is more likely today– not tomorrow. If you’re currently a renter and you’ve contemplated becoming a homeowner but you aren’t sure if you even qualify, it never hurts to find out. It definitely won’t hurt to see what rate you qualify for and how much house you can afford. You might be even be pleasantly surprised that you can own a home for as much as you pay in rent! If your fear of reaching out to a lender is that you may not qualify for a home loan, due to a low credit score – think again. You may qualify for an FHA loan; even with a 580 credit score, you could qualify for a rate as low as 3.5% with no down payment. If you’re a first time home buyer, you may qualify for financial assistance, not to mention all of the other perks that can come your way as well.
Whether you’ve been planning on becoming a homeowner or you’ve considered home buying but never thought it was an option for you – you owe it to yourself to talk to a mortgage lender today With mortgage rates near all-time lows, you don’t want to look back and say you didn’t at least give it a shot.
2. Refinance your mortgage
Maybe you’re already a homeowner, with no intention to sell, but… could you use extra cash in your pocket each month? With today’s low interest rates, refinancing your existing mortgage at a lower rate can save you thousands of dollars annually. If your current rate is at say, 4.25% and you could potentially get it down to 3.7%, why wouldn’t you?
When it comes to refinancing, you have many options to choose from. You could do a rate-and-term refinance where you lower your interest rate and/or adjust the term of your current loan. This could be ideal for you if you have an adjustable-rate mortgage and would like to change it to a fixed-rate mortgage instead.
You may also have the option of doing a cash-out refinance, where you replace your existing loan with a new rate and/or term, but also increase your current loan amount so that you can cash-out the loan difference. If your home is in need of a few renovations, have a child’s college tuition to pay, or are interested in putting money down on a second home, a cash-out refinance may be something you want to look into.
The best time to refinance is always when interest rates are low! There are many reasons why homeowners decide to refinance their homes, and there are plenty of refinance options available for you to choose from.
3. Become a seller
If you’ve wanted to sell your home in the years following the recession but you were not able to because of economic conditions, now may be the time to let go of the past and consider placing that “For Sale” sign on your front lawn.
Low interest rates won’t last forever and as more and more buyers enter the market for a home, , the more likely you are to sell your home at your desired price. Seek professional advice by reaching out to your Realtor®, research your local market, and establish a price range. With today’s interest rates, there’s no point in waiting to get the process started!
Whether you’re interested in becoming a homeowner or refinancing your mortgage, reach out to a Personal Loan Consultant at New America Financial and get your mortgage questions answered!