From March 17 to March 24, the average 30-year fixed interest rate increased by 4.16% to 4.42%, reaching the highest level since Jan. 2019. This growth expected to continue in April and over the rest of the year. But home buyers and refinancing homeowners should keep waiting for in a low interest rate.
So here are just a few strategies to keep in mind if you’re mortgage shopping in the next few months.
The Federal Reserve made its 2022 plans very clear; officials indicated an aggressive path ahead, with rate rises coming at each of the year’s remaining six FOMC meetings.
It’s a move the Fed makes in order to combat inflation, and mortgage rates almost always grow in correlation.
Interest rates jumped after both FOMC meetings so far this year, with a 31 basis point (0.31%) surge to the average 30-year fixed rate immediately following March’s meeting.
While mortgage rates are famously volatile and many factors can cause a weekly decrease, almost every indicator points to them growing over the course of the year.
If you’re want to buy a new house or refinance your mortgage — and can afford to — the best time to lock in a rate, in all likelihood, is right now. And remember, you can do some preparation work, like getting all paperwork organized and done before consulting the mortgage lenders.
Interest rates are on the rise and are expected to keep going up in 2022, it’s a good option to make lenders compete for your business, since the rates no longer at an all-time low.
First, you can get a qualified or prequalified rate from a lender, then you can consult other lenders to see if they can offer you a better rate.
Driving competition between multiple mortgage companies is how many people end up with lower rates and save money over the life of their loan. And why wouldn’t you want to save money?
Mortgage lenders advertised online and attract homebuyers with low interest rate, but notice, low rates aren’t available to every borrowers, people with perfect credit score and can put a down payment of 20% or more are easy to get low rate.
The rate lenders actually offer depends on:
You need to fill out a loan application to know what rate you can get, and lenders will check your credit and verify your income and debts, then give you a ‘real’ rate quote based on your financial situation.
You should get 3-5 of these quotes at a minimum. Then compare them to find the best offer.
Look for the lowest rate, but also pay attention to your annual percentage rate (APR), and other fees the lender may charged when applying a mortgage: estimated closing costs, origination fees.
This might sound like a lot of work. But you can shop for mortgage rates in under a day, it doesn’t take lots of time. And shaving just a few basis points off your rate can save you thousands.
