Are they going to keep falling? Should I wait until they get even lower?
In 2020, buyers were given an opportunity to spend more on a home without increasing their monthly mortgage costs because of the steady mortgage rate drop throughout the year. According to Freddie Mac, rates hit all-time lows 12 times this year, dipping below 3% for the first time ever while making buying a home more and more attractive as the year progressed.
The challenge with waiting is that you can easily miss this optimal window of time and then end up paying more in the long run. Last week, mortgage rates ticked up slightly.
While rates are still lower today than one year ago, as the economy continues to get stronger and the pandemic is resolved, there’s a very good chance interest rates will rise again.
If you’re planning to wait until next year or later, Mike Fratantoni, Chief Economist at the Mortgage Bankers Association (MBA), forecasts mortgage rates will begin to steadily rise:
As a buyer, you need to decide if waiting makes financial sense for you.
Bottom Line
If you’re planning to buy a home and want to take advantage of today’s low rates, now is the time to do so. Don’t assume they’re going to stay this low forever.
