In August, mortgage rates soared to 7.23%, which is the highest they have been in 22 years. If you are buying a home during a time when rates are high, there are certain steps you should take to make homeownership as affordable as possible. Here are a few tips.
Tips for Buying a Home
- Have a plan for the future.You do not have to permanently be stuck with high interest rates just because you bought your home when rates were high. Whether you buy a home with a fixed or adjustable mortgage rate, you can refinance later.Also, if you go with an adjustable rate mortgage, it should come with a low introductory rate that can help keep it affordable during this period of high rates.
- Take advantage of opportunities that might otherwise be unavailable.Homebuyers may turn shy when mortgage rates climb. Home supply is not as high as it could be, but if there is a sufficient drop in demand, the supply could become more available and more affordable. By shopping for a home now, you might find yourself with the chance to buy a home that would not otherwise still be for sale or within your budget. Research your local real estate market to identify these opportunities.
- Improve your borrower profile. Regardless of when you are purchasing a home, improving your borrower profile can help you qualify for more affordable rates. But at no time is it more important to enhance your profile than when rates are high. When you contact us for a consultation, we will be able to sit down with you and give you personalized advice for how you can improve your borrower profile based on what you tell us about your financial situation.
The following may all help you find affordable mortgage rates:
- Boosting your credit score.
- Increasing your income.
- Decreasing your debts.
- Make a larger down payment. When you put a large down payment on a home, you do not need to borrow as much. Lenders feel more comfortable with smaller loans, and may thus offer more affordable rates than they would to borrowers who are only putting down a small percentage. Of course, there are other factors that can affect your decision to make a larger or smaller down payment, but it is worth considering if it is within your means to do it.
- Choose a mortgage company that will work hard to bring you affordable rates. One more tip for buying a home when rates are high is to pick a mortgage company that will strive to offer you affordable rates.
Buy A Home or Refinance in Farmington Hills
The team at MMS Mortgage Services can give you personalized tips to improve your mortgage qualifications, and match you with a lending product that will help you save now and in the future. Please contact us at (248) 788-0800 to set up your mortgage consultation. We can help you buy a home or refinance in Michigan or 15 others states.