The ever-changing marketplace needs to be understood so you can determine how it’s going to affect your ability to get a mortgage.
Current Mortgage Rates
According to recent data as of February 2018, the mortgage rates have been increasing steadily over the past several weeks. The average is a 0.6 point increase and is resulting in an approximate 4.32 percent 30-year fixed rate. The 15-year fixed rate mortgage is averaging around 3.77 percent.
The 15-year fixed mortgage rates are traditionally lower as an incentive for people to pay their home loans faster. If you have the finances to allow you to pay the higher mortgage payment by spreading the loan over 15 years as opposed to 30, it can be something to explore.
February is usually when the housing market starts to get busier. There are more mortgage applications as more people look to become homeowners. However, due to the higher rates, that isn’t happening at the moment.
Options When Obtaining a Mortgage
You may not be in a situation where you can wait to buy a home. If you want the rates to fall, you could be waiting a while because the mortgage marketplace is always changing.
You want to be wary of getting ARMs as the adjustable rate could go up instead of down, raising your mortgage payment even higher than what you were expecting.
If you do get a fixed rate that is higher than you would like, you can always look at refinancing later on when the rates begin to level off and even drop.
“While the stock market leapt into the New Year with strong gains, only to give it all back over the past few days, interest rates have generally moved higher, with the 10-year Treasury and 30-year mortgage rates about 30 basis points higher than where we started at the beginning of January,”
MBA’s chief economist Mike Fratantoni explained.
By exploring such things as wage growth and the job market, you can predict how the long-term rates are going to look. As these change, so will the rates for obtaining a mortgage.
There are always options available to you. Should you get a higher mortgage rate than what is desirable, you can look at changing it as the rates drop. However, you may want to consider getting into a rate now before they continue to rise as the job market continues to improve.
