While mortgage rates are on the rise, let’s be clear, they are still near all-time lows. That means that no one should feel pressured to buy a home. Is it time to start thinking about buying one? Maybe, but that depends on whether or not it’s right for you. The very first thing you have to address is whether or not you’re able to take on a home in all form and fashion. Your finances must be a match, and well, there is a long list that comes with preparing to be a homeowner. So don’t go rushing to buy a home just because the interest rates are rising.
Do understand, however, that waiting does mean you might have to pay much more in interest over the life of your loan. Still, you can’t rush into a situation like that. The interest rates are only slowly going up anyway, and let’s look at why. First, the FED appeared to do so in a retaliation move against our current president. That is a whole other news story in and of itself.
Have you seen mortgage company commercials lately? One thing that should make you feel less uneasy is that rising interest rates are going to make the mortgage companies get competitive with each other. This can be advantageous to consumers, and if course you would think it also keeps some of those great mortgage deals around.
It’s just like with banks and certificates of deposit. The rates went way down, and the interest, which is a good thing with CDs, never seemed to recover with traditional banks. Yet, all the sudden here are online banks and certain financial institutions offering CDs at rates that are much higher, kind of defying the market.
In other words, consumers might want to make sure they keep up with trends as well as the rising interest rates. Sticking with a traditional mortgage company sounds good, too, but you have to consider the idea that a forward driven and more modern company might give you a better deal. Just remember, you also want a stable mortgage company.
As for why mortgage interest rates are on the rise, it happens for a variety of reasons. A lot of it boils down to what banks face when it comes to borrowing money. Is it more expensive for them to do so all the sudden? Well, that is going to trickle down to consumers in different ways. The mortgage is one of them, but hey, there is another big reason why you shouldn’t worry about rising interest rates.
Do you know what you might get for an interest rate decades ago? At one point, a good interest rate would have been 10 percent. Furthermore, look at the recent history when it comes to mortgage interest rates. When was the last time they topped even five percent? It is supposed to be quite awhile before it happens. So buy if you’re going to buy but continue on as normal, albeit observant.