I have been hearing clients and friends ask about when mortgage rates are going to be at 4%, and shouldn't they wait to purchase or refinance until they get that low. The world according to Robby is no, don't wait. If you are buying a home, prices are very good right now, and mortgage rates are available that are within one half of one percent of what George Washington was getting financing for, or pretty darn close.
I listened to some very highly regarded names in the mortgage industry speak and explain about the Feds purchasing Mortgage Backed Securities. This is a very good thing and we are glad our government is stepping up and helping out. The rates a consumer sees are based on the "coupons" that support these. Since the lowest coupons available are at 4%, and anyone buying these wants to make a profit on their investment, it is common sense that rates available to the consumer are going to be at least .75 to 1% higher.
Another point relating to people waiting for the 4% mortgage rate is they get greedy. Some could save approximately $250. per month today but want to wait for rates to hit that 4% mark and save another $30. per month. How much are they losing while playing this waiting game.They might as well head to their local casino and bet it all on Red 16!
Will prices drop? Will rates drop? What happens when the government stops feeding in money? Some of the best Crystal balls in the industry are just not sure. Are you a gambling person?
My advice to Friends and Clients is buy while prices are low and interest rates are low, that is a winning combination to bet on.
If the house you loved at the price you were happy with is gone, a 4% mortgage won't help you get your family into the neighborhood you planned on.
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Thanks for listening to me, now I'm here to listen to you, bring your questions.
Robby
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