21 Oct The Bibel Team: Mortgage Interest Rates
Eric: Hey everyone. Eric Bibel with the Bibel team at NEO Home Loans, and today I’m going to talk to you about what experts are saying about mortgage interest rates. If you like the content you’re seeing, please like, subscribe, share and comment. It enables us to continue to help convey our message out externally.
So, interest rates. Tons and tons of questions, continue to funnel through around, what are rates doing? Where are rates going? Is now still a good time to either buy or refinance? The bottom line, distill this message down to very quick. Takeaway interest rates are near the best levels we’ve ever seen in our lifetime. What does that mean? Why do I say that? So many times we get clients coming back, whether it be in a buy or a refinancing scenario, and say, I want to just wait and see what rates are going to do. There is no time, like the present. Rates are phenomenal, no matter how you cut it. And what that means to a prospective buyer is, as rates move, whether it be up or down, that can impact your monthly cashflow position, or mortgage payment.
So as rates rise, that decreases one’s purchasing power. An increase in payment can represent you getting the home with a pool or not getting a home with a pool. Or getting the home in a neighborhood that has the school that you want to send your children to or not being able to send your children to. So interest rates influence a huge segment of what your payment can do and can be. So interest rates, as I was saying, are near historic lows. Experts agree that interest rates as a whole, seeing rates, really sub 4% and in some instances, sub 3% is unfathomable. We look back in time, that average rate of mortgage interest over the last 60 years is over 6%. I remember talking with my parents when they purchased their first home. Back in the eighties, there was a point where mortgage interest rates were over 14%. Their first home, they got a 30 year fixed at 17 and a half percent. Wildly insane.
Today we’re talking about rates with a two or a three in front. It is just an incredible time to be a buyer or seller, or even an opportunity to refinance. And it presents such a unique opportunity for you to take advantage of fixed debt. So a fixed rate of interest where your payment will not adjust for the duration of the mortgage term. It is such a beneficial time to be in today’s market. So what we expect to see rates do through the of 2021, and really into the future is, as it stands right now, mortgage rates are really the best we’ve seen. Over the next few months, so as we close 2021, with the Delta variant now, supply chains, unemployment, inflation, we do expect to see rates kind of hover at these levels. There is a potential that we could see rates even come down slightly further, but with that, I wouldn’t really bank on it. There’s a lot of variables that play into it, but really, as we close 2021, expectation is things start to normalize.
We hear a lot about normalcy, but as things come back to the pre pandemic world, supply chains start to open back up. Hopefully get a curb on the pandemic as a whole, the actual virus. Unemployment starts to stabilize. Inflation, so the cost of money increasing, starts to calm down. We absolutely expect to see, and not just we mortgage experts, economic experts expect to see interest rates climb. So why do I say today, there is no time like the present? While rates are still incredibly low, if you are waiting for rates to come lower, you could be putting yourself into a position where you potentially price yourself out of the home that you want. So with all of that, the takeaway of today is, if you’re on the fence, thinking about buying, thinking about refinancing and thinking about selling, call us today. There is no time like the present. We would love the opportunity to assist you. Please reach out.