Have you been going back and forth with whether to buy a house? If so, you’re not alone.
Buying a house isn’t a decision to take lightly, and several questions might run through your mind. Can I afford a house? Am I ready for the responsibility? Is now the right time?
If you’re in a position to buy, now’s as good a time as ever to take the plunge—especially if you’ve been waiting for mortgage rates to drop.
Mortgage Interest Rates are on a Downswing
Mortgage interest rates aren’t set in stone. They can fluctuate from day-to-day, month-to-month, and even year-to-year. And when they take a turn for the better, some see this as an opportunity to purchase a home.
Rates have remained low by historical standards for some time now, but recently, they’ve hit a near two-year low.
What does this mean for you?
Simply put, buying a home now—before rates start to creep up again—can strengthen your purchasing power. You’ll not only save money, you’ll also get more house for your money. Mortgage rates directly impact the size of your monthly payment and ultimately determine how much you’re able to spend on a property.
Hypothetically speaking, let’s say you purchase a home when interest rates are higher, perhaps 5.5%. If your mortgage lender calculates that you can spend a maximum of $1,500 a month on your monthly payment, this means you’re able to qualify for a property with a purchase price up to $247,000*. (Figure based on a Conventional Loan with a 5% down payment, 30-year fixed-rate and 720 credit score. Payment example excludes taxes, insurance, and PMI.)
Not a bad price. But let’s say you took advantage of current low mortgage rates and qualified for a rate of 3.7%. Using the same scenario, you could now get a property with a purchase price up to $304,000* (excluding taxes, insurance, and PMI).
Think of the benefits that come from getting more house without having to spend more on a monthly basis. Increased purchasing power can mean a home with more square footage, newer features, or perhaps buying in your dream neighborhood as opposed to settling for a property you don’t really like.
Let Us Know How We Can Help
The truth is, interest rates don’t stay low forever. There’s no way to predict if and when they’ll increase. What we do know, however, is that rising rates decrease buying power, so now’s the time to act. If you’ve been putting off buying a home, don’t put it off anymore.
Our loan experts at FirstBank Mortgage can walk you through the process, answer your questions, and help you find the right mortgage for your situation. Whether you’re looking for a conventional, FHA, VA or another mortgage program, give us a call today to get started.
*Disclosure: Application is required and is subject to underwriting. Not all applicants are approved. Full documentation & property insurance required. Loan secured by a lien against your property. Fees & charges apply and may vary by product and state. Terms, conditions & restrictions apply, so call for details. FirstBank Mortgage provides a variety of loan products with different rates, payments and fees. All loans are subject to credit approval. Products and services offered by FirstBank. FirstBank Mortgage Partners is a division of FirstBank.