Buyers Use Larger Down Payments to Offset Rising Rates
To keep monthly mortgage payments more affordable, more homebuyers are reaching deeper into their pockets to make larger down payments, according to a new survey of 600 homebuyers by LendingTree.
Sixty-four percent of prospective homebuyers say they expect mortgage rates to rise, and 68 percent say they expect home prices to rise in the next 12 months, according to the LendingTree survey. That has prompted 57 percent of respondents to say they plan to make a down payment of 15 percent or more on their home purchase. Meanwhile, 44 percent say they will have a down payment of less than 15 percent.
Also for affordability, the majority of homebuyers surveyed said they prefer fixed-rate mortgages, particularly 30-year fixed-rate mortgages (45 percent), compared to 15-year fixed-rate mortgages (36 percent) and adjustable-rate mortgages (seven percent).
“The housing market is stabilizing and financing is becoming more available for potential home buyers,” says Doug Lebda, founder and CEO of LendingTree.com. “Increasing home prices are providing would-be sellers with the confidence needed to take action, while rising interest rates are placing a sense of urgency on potential home buyers. Together this creates a unique window of opportunity for buyers and sellers to take advantage of the market while home prices and rates are still affordable.”
Source: Real Estate Digest, Old Republic National Title Insurance Company, September 2013 Volume 39 Number 9
Title Junction is a full service real estate title company serving the area of Fort Myers, Cape Coral and the entire state of Florida since 2005. The company handles a number of real estate title services for both commercial and residential properties. Employees of Title Junction can also act as a witness in courtesy closings as well as an escrow agent or a notary public. Please contact Jennifer Ferri of Title Junction, LLC for further information @ 239-415-6574 or www.title-junction.com
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