15 Apr The Bibel Team: Buying a House & Mortgage Rates During a Pandemic

Buying a house during a pandemic, and mortgage rates today.

Hey, I’m Eric Bible with the Bible team at Neo home loans. Tons and tons of questions we are fielding every day as a team of around, what is it like purchasing a home during the pandemic, and what are mortgage rates doing? So first and foremost, pandemic, it has hit every facet of our economy both domestically and internationally. And to say that the housing market has not felt some of the effects is naive. So here today, I want to talk through what we have seen during the pandemic. And as we exit the pandemic, what changes we can expect on a go-forward basis? And really, you as a potential buyer, what you should know in order to be prepared for what lies in front of you? And with that, again, want to close out with what to expect and what interest rates are doing on a go-forward basis.

So first and foremost, pre-pandemic, you saw home on the internet, you liked it, you went and saw it, thought about it, connected with a realtor, connected with a mortgage professional, and then wrote an offer. Offer gets accepted. You become a homeowner. So fundamentally, yes, that concept is still there, but there have definitely been some changes. So, you know, think about it from like everything that we’ve seen, how we grocery shop, how we interact with friends, family members, how our children go to school. Everything is different. And again, housing market housing economy really as a whole is no different. So here kind of start to finish, what we’re seeing a lot of sellers demand or, or expect prior to you, a potential buyer even viewing the property is that the, the financing piece is vetted. So really being able to show a prospective seller that you, as a prospective buyer have the means in order to purchase that property.

So really, the starting point that we recommend all potential homeowners, speak with a mortgage professional sooner rather than later get pre-approved ASAP. So sitting down, talking through your finances, understanding what your buying power is, understanding what programs, rates terms in which you qualify for. Really what the payments look like. So when you do have the pre-approval in place, you can go to the seller and say, “hey, look, I am vetted.” I have the sufficient means. We are not just looky-loos. So that’s one aspect to what we’ve also seen is, as I’ve spoken in previous video content was around demand and inventory being so low. So with inventory and in so low and demand so high, we’re seeing that homes are going so fast. So here, if you’re not in a position of where you have financing dialed in, you find a home that you love online.

Well, Hey, guess what? There’s, you know, a hundred other people that are seeing the same thing that are potentially well-positioned and you’re kind of left holding the bag waiting for, for the next one to come up. So really getting everything. If, if the thought is there that you want to purchase a home, getting yourself pre-approved sooner rather than later is really the recipe for success. And again, speaking with a mortgage professional like ourselves is the key to achieving that pre-approval. Another thing that we’re finding is really bringing your patience. A lot of the, you know, where yes, the process of getting into the property, getting an offer submitted and getting an offer accepted, move super, super, super fast. So again, being able to act quickly is in your best interest, but through the process, we found, especially in the height of the pandemic, that there were a ton of delays around county recording office, the ability to obtain notaries, and government processing.

So certain documents, certain verifications like everyone, we were all put in a position to where we had to kind of go to the remote environment, which a lot of companies were not equipped to pivot so quickly. So we found in kind of the early stages of the pandemic, that things that we were accustomed to getting back in a very, very expedited manner, well, there were a ton of delays because essentially everything was shut down. So really the advice that we’re giving to clients is where yes, an expectation is to move very quickly, but in the same breath, be prepared to be patient. There are things that are outside of our control, your control, your realtor’s control, that are just subject to the current environment. That, you know, in the midst of a pandemic or a global shutdown, if you want to call it, things are delayed in some capacity.

So just really cognitively being aware of that, so you’re not setting yourself up for failure. So those really some key points of, you know, what it looks like in buying through a pandemic. I mean, I would close in that is, it is super, super crucial to be pre-approved with a mortgage professional. And that’s something, again, we’ll talk in a later video. But I want to really stress that if you are considering purchasing real estate, have the financing in order that above all else is the most crucial part to this process. So here, another element that we’re feeling a ton of questions on are, what are rates doing? What do we expect rates to look like in the future? What are they now? All great questions, and really what we’re seeing in the midst of the pandemic coronavirus, with the economy going through some significant changes, is that rates have actually benefited.

Rates are at all time lows, the lowest we have ever seen, actually, in our lifetime. And this is really all in a response to what the federal government has done in order to essentially inject lifeline into our economy to ensure that it’s thriving and moving forward. So really as a prospective homeowner, you’ve been put into a position of where you’re able to capitalize on some of the best rates we’ve seen in our lifetime. With that said, like all good things, they do come to an end. So as the the economy starts to open back up, the grips of the pandemic, start to move away, we do expect rates to start to climb. And, and really for the close of 2021 into 2022, is that we will see rates kind of increase. So again, kind of overarching theme throughout our content is really, there is no time like the present rates are at some of the best levels that we have seen in our lifetime.

In some instances, we’re looking at rates with the two in front of it. So again, 2% in that two and a half range and, and, you know, low threes in some instances, which is just unbelievable, especially looking at what the historic rate of interest is. Looking back over the last 40 years, average mortgage rate on a 30 year fixed is six and a half percent. So hearing even a rate with the three in front of it is unbelievable. It just opens up so much potential opportunity for prospective homeowners from a payment standpoint. It’s really unbelievable.

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