Are Higher Mortgage Rates Here To Stay?

Mortgage rates have been back on the rise recently and that’s getting a lot of attention from the press. If you’ve been following the headlines, you may have even seen rates recently reached their highest level in over two decades (see graph below):     That can feel like a little bit of a gut punch if you’re thinking about making a move. If you’re wondering whether or not you should delay your plans, here’s what you really need to know.    How Higher Mortgage Rates Impact You   There’s no denying mortgage rates are higher right now than they were in recent years. And, when rates are up, that affects overall home affordability. It works like this. The higher the rate, the more expensive it is to borrow money when you buy a home. That’s because, as rates trend up, your monthly mortgage payment for your future home loan also increases.   Urban Institute explains how this is impacting buyers and sellers right now:  “When mortgage rates go up, monthly housing payments on new purchases also increase. For potential buyers, increased monthly payments can reduce the share of available affordable homes . . . Additionally, higher interest rates mean fewer homes on the market, as existing homeowners have an incentive to hold on to their home to keep their low interest rate.”   Basically, some people are deciding to put their plans on hold because of where mortgage rates are right now. But what you want to know is: is that a good strategy?  Where Will Mortgage Rates Go from Here?   If you’re eager for mortgage rates to drop, you’re not alone. A lot of people are waiting for that to happen. But here’s the thing. No one knows when it will. Even the experts can’t say with certainty what’s going to happen next.   Forecasts project rates will fall in the months ahead, but what the latest data says is that rates have been climbing lately. This disconnect shows just how tricky mortgage rates are to project.   The best advice for your move is this: don’t try to control what you can’t control. This includes trying to time the market or guess what the future holds for mortgage rates. As CBS News states:  “If you're in the market for a new home, experts typically recommend focusing your search on the right home purchase — not the interest rate environment.”  Instead, work on building a team of skilled professionals, including a trusted lender and real estate agent, who can explain what’s happening in the market and what it means for you. If you need to move because you’re changing jobs, want to be closer to family, or are in the middle of another big life change, the right team can help you achieve your goal, even now.  Bottom Line The best advice for your move is: don’t try to control what you can’t control – especially mortgage rates. Even the experts can’t say for certain where they’ll go from here. Instead, focus on building a team of trusted professionals who can keep you informed. When you’re ready to get the process started, connect with a local real estate agent.

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Buyer Traffic Is Still Stronger than the Norm

Are you putting off selling your house because you’re worried no one’s buying because of where mortgage rates are? If so, know this: the latest data shows plenty of buyers are still out there, and they’re purchasing homes today. Here’s the data to prove it.The ShowingTime Showing Index is a measure of buyers touring homes. The graph below uses the latest numbers available and compares them to the same month in the last normal years to show just how active today’s buyers still are:As you can see, when June 2023 numbers are stacked alongside what’s typical for the housing market at this time of year, it's clear buyers are still active. And, they’re actually a lot more active than the norm.If you’re wondering how this could possibly be true, it’s because buyers are getting used to higher mortgage rates and accepting them as the new reality. As Danielle Hale, Chief Economist, Realtor.com, explains:“Interest rate hikes continue to further cut into buyers' purchasing power, although they appear to have adapted to the higher mortgage rate environment . . .”It’s simple. Buyers will always need to buy, and those who can afford to move at today’s rates are going to do so.The Key Takeaway for YouWhile it’s true things have slowed down from the frenzy of the last couple of years, it doesn’t mean today’s market is at a standstill. The reality is: buyer traffic is still strong today. Even with today’s mortgage rates, plenty of buyers are still making their moves. So why delay your own move when there’s clearly a market for your house?Bottom LineDon’t put off your plans because you’re worried no one will buy your home. The opposite is true, and more buyers are more active than the norm. Connect with a real estate agent to get your house ready to sell, so it makes the best first impression possible on those eager buyers.

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What is a home equity line of credit, or HELOC?

As a homeowner, you have an opportunity to take advantage of the equity in your home through a home equity line of credit, or HELOC. This can be a great option for those who are looking to invest in their home, pay off high-interest debt, or make a large purchase. However, not all HELOCs are created equal. In this blog post, we will discuss the best home equity line of credit rates available to sellers, those with a mortgage, and those who are investing in their home. What is a home equity line of credit, or HELOC? A HELOC is a revolving line of credit that is secured by your home. It is similar to a credit card in that you are approved for a certain amount of credit, and you can borrow against that amount as needed. The interest rate on a HELOC is typically lower than that of a credit card or personal loan, making it an attractive option for those who need access to cash. Sellers If you are selling your home, a HELOC can be a great way to access the equity in your home without having to sell it outright. This can be especially helpful if you are looking to make improvements or repairs to your home before putting it on the market. The best HELOC rates for sellers can vary depending on your credit score and the amount of equity in your home. However, some of the top lenders for HELOCs include Wells Fargo, Bank of America, and Chase. These lenders offer competitive rates, flexible payment options, and the ability to access your funds quickly and easily. Mortgage If you have a mortgage on your home, you may still be eligible for a HELOC. In fact, many homeowners choose to take out a HELOC in addition to their mortgage in order to access additional funds as needed. The best HELOC rates for those with a mortgage can also vary depending on your credit score and the amount of equity in your home.  Investing If you are looking to invest in your home, a HELOC can be a great way to access the funds you need. Whether you are looking to make home improvements, add an addition, or even purchase a rental property, a HELOC can help you achieve your goals. HELOC vs. cash-out refinance A cash-out refinance replaces your current home mortgage with a larger home loan. The difference between the original mortgage and the new loan is disbursed to you in a lump sum. The main difference between a cash-out refinance and a HELOC is that a cash-out refinance requires you to replace your current mortgage, while a HELOC leaves your current mortgage intact; it adds an additional debt to your finances. A HELOC may be a better option for you if: You want more flexibility. You already have a good mortgage rate. You plan to use your HELOC only for tax-deductible home improvement projects. A cash-out refinance may be a better option for you if: You prefer a fixed monthly payment. You want a lower mortgage rate. You want to withdraw more home equity. In conclusion, a home equity line of credit, or HELOC, can be a great way to access the equity in your home and achieve your financial goals. Whether you are selling your home, have a mortgage, or are investing in your home, there are a variety of lenders available that offer competitive rates and flexible payment options. By doing your research and comparing rates, you can find the best HELOC rate for your unique situation.

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