Predictions Suggest Borrowers should lock in a Mortgage Now

By
Real Estate Sales Representative with Castles Unlimited®

If you haven't heard, mortgage rates have reached the lowest point in 50 years! this is good news for all buyers out there! 

Do you think this an ideal time for all borrowers to lock down a mortgage rate? is it going to be worth it? According to experts, it is! since it is hard to forecast a better time to do so. 

Everything is possible, there is a chance that Treasury rates could go lower, however, that does not imply that mortgage rates will follow. 

Waiting for an uncertain event isn't a safe move, locking in your savings to acquire a new home NOW is probably best.

The 10-year Treasury yield has lowered considerably in the last week, although we didn't see an equal drop in the mortgage rates. 

The Treasury yield will stay near 0.5%  or to 0.6% according to experts, such a statement suggests that mortgage rates won't be going lower.

Locking a rate is a guarantee that a lender will provide a mortgage loan to an applicant with a certain interest rate, price and for a defined period of time. The interesting part is that, if rates start to go up the applicant will keep the lower rate that was initially locked in. As a result, several lenders are feeling overwhelmed because of the number of applications they are receiving. 

As a reminder, look out for: 

  • The locking of the rates is only good for weeks to two months, and so if your loan is not processed within that period, the locked-in rate will not be useful for when you might need it. You need to make sure that the duration of the locked-in mortgage will leave the lender with enough time to successfully process the loan. 
  • Fees: you will probably need to pay to lock-in a rate, these costs are variable. However, the ones that are expected to be less than 60 days can range from 0.25% to 0.5% of the loan's total. 
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Tags:
lender
mortgage rates
borrowers
predictions
suggest
homebuyer
low mortgage
lock in a mortgage

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James Lowenstern

Castles Unlimited. Newton MA Real Estate
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