Unless you have been living under a rock, I am sure that you have probably heard about interest rates rising. Rates seem even higher right now because they were so low just a short time ago. It is important to realize that interest rates were so low recently because of the government's response to COVID-19 and now that they have risen so quickly, it seems worse than it really is. However, this still leaves many potential homebuyers feeling like they can't afford to purchase a home...but what if I told you that your interest rate doesn't really matter?
That's right! What is much more important than your rate is your monthly payment and how that fits into your family's budget.
We see clients all the time that tell us, "If rates go down a quarter of a percent, we will buy" or if they get to a certain rate, then they will buy. Which in response, I ask them, "Do you know how much that will affect your payment?"....they have no idea. People seem to pick these interest rates out of thin air or maybe they think that since rates have been high lately so if rates drop just a bit more, then they can justify the home purchase. My point is, sometimes people don't even know how the difference in rates actually affects them and base their decisions on emotions without considering all the benefits that a home can provide.
It's not just interest rates, payments, appreciation, down payments, and closing costs. There are massive benefits to homeownership that you won't see on a loan estimate.
When I purchased my last home, it helped us welcome two children into the world (with another on the way!). It strengthened our marriage by giving us the space we needed. Our house gave us the ability to host events with friends and family and even provide a place to stay for out of town guests.
Financially speaking, having a fixed interest rate when the economy is unpredictable can provide peace of mind knowing that no matter what happens, my payment won't change.
Have interest rates increased? Yes, but don’t let that scare you away from investing in your future and the many benefits that can come from homeownership. The emphasis of your decision should be on the payment that fits into your budget and not the emotion of what you may have seen on the news that day about the economy.
The market and interest rates are always going to change, but life only happens once. If the payment for a new home works for your budget, now is as good a time as ever to pursue your homeownership dreams.
If you’re ready to talk about what budget works for you, schedule a time with one of our Home Loan Advisors. We would love to guide you through your mortgage journey and give you the confidence you need to make wise decisions.
-Thomas Wilson
Founder of Fox Financial
Owning a home is a significant accomplishment, but it also comes with a set of responsibilities. One crucial aspect of homeownership is regular maintenance to ensure the longevity, safety, and functionality of your property.
So you own a home and you have a super low interest rate on it…which makes you not want to go buy another house right now while rates are way higher than what you currently have...but what if I told you that you could use your low interest rate on your current home to help you buy another one?
Unless you have been living under a rock, I am sure that you have probably heard about interest rates rising. Rates seem even higher right now because they were so low just a short time ago. It is important to realize that interest rates were so low recently because of the government's response to COVID-19 and now that they have risen so quickly, it seems worse than it really is. However, this still leaves many potential homebuyers feeling like they can't afford to purchase a home...but what if I told you that your interest rate doesn't really matter?
