Concerned About Mortgage Rates? Control What You Can!

You've probably heard a lot about mortgage rates recently. You might have seen headlines discussing last week's Federal Reserve (the Fed) meeting and its impact on rates. However, it's essential to understand that the Fed doesn't directly determine mortgage rates, despite what the headlines may suggest.

The truth is that mortgage rates are affected by various factors, such as geopolitical uncertainty, inflation, and the overall economy. It's difficult to predict when all these factors will align to bring rates down.

Because of the complexity involved, trying to time the market is generally not advisable. There are too many variables beyond your control. Instead, it's best to focus on what you can control. Regarding rates, here's how you can influence them to make your moving plans a reality.

Your Credit Score
It's important to remember that credit scores can significantly impact the mortgage rate you receive. According to an article from CNET, "You can't control the economic factors influencing interest rates. But you can get the best rate for your situation, and improving your credit score is the right place to start. Lenders look at your credit score to decide whether to approve you for a loan and at what interest rate. A higher credit score can help you secure a lower interest rate, maybe even better than the average."

Maintaining a good credit score is essential to the mortgage process. With current interest rates, you must do what you can to secure the best rate possible. If you want to improve your score, seek advice from your trusted loan officer. Need a trusted loan officer? Our team is connected to the best lenders in Kansas City, so call us for a referral based on your home loan needs!

Your Loan Type
When it comes to loans, various types are available, each with different terms for qualified buyers. The Consumer Financial Protection Bureau (CFPB) explains, "There are several broad categories of mortgage loans, such as conventional, FHA, USDA, and VA loans. Lenders decide which products to offer, and loan types have different eligibility requirements. Rates can vary significantly depending on the loan type you choose."

When working with your team of real estate professionals, inquire about the loan options available for your specific situation and find out which types of loans you may qualify for.

Your Loan Term
When deciding on a home loan, it's essential to consider the loan term: how long it will take to repay your loan and own your home entirely. The loan term can affect your interest rate, monthly payment, and total interest paid over the life of the loan. Depending on your situation, the length of your loan can also impact your mortgage rate.

Bottom Line
Remember, you can't control what happens in the broader economy but can control the controllables. Work with a trusted lender to review what you can do to make a difference. By being strategic with these factors, you can combat today's higher rates and lock in the lowest one you can. Questions? Contact the Just Say Home Team at 816-656-2816.

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