While interest rates have been in a freefall over the last year thanks to a sputtering economy, the rates are likely to begin to rise again in the near future. You do not want to miss your chance to lock in these historically low rates before they increase. Here are a few things to consider as you look at interest rates and decide what to do.
Good Time to Move: Many savvy homeowners are realizing that now is a good time to make a big move. As more people continue to stay in an online work environment, they have also realized that they need more space in their homes to make this arrangement work. Other homeowners are deciding to move to a place with a lower cost of living during this anemic economy. With interest rates at these rock-bottom levels, it may make financial sense to make this move now while you have a chance.
Understanding Interest Rates: Interest rates on mortgages have been dropping steadily over the last few decades. Today’s current interest rates are hovering at just below 3%. However, economic experts do not expect the rates to stay at these low levels, predicting an increase over the next few years. Once the economy starts to rebound with greater vigor, look to the Federal Reserve to begin to inch the base interest rate upwards.
When You Should Move: If your current mortgage’s interest rate is higher than today’s average, you would be wise to make that move that you have been thinking about so that you can lock in a lower rate. If the rate is significantly lower than what you are paying now, you will be able to get more home for your buck and still enjoy a lower monthly payment.
It is eye-opening to see how the smallest change in the interest rate can have a big effect on your overall mortgage costs. Your purchasing power will suffer if you wait too long to secure a lower rate. This is because you will need to look at less expensive homes if the rates start to increase.
Refinancing as an Option: If you are happy with your current home and do not want to move, you can also look at refinancing your existing mortgage as an option. This will help you to take advantage of the record-low interest rates. A lender can help you to work through the numbers to determine if this is a good choice for your financial interests.
When looking at the best real estate companies in Central Florida, be sure to choose a professional who can help you to navigate the complicated world of interest rates. This will give you the confidence of knowing that you are making the most informed decision about your financial future.