Home Buyers Be Advised, Rates Are on the Rise
If you're contemplating buying a new home, don't procrastinate too long. That's the advice of mortgage experts.
In case you missed the news, the Federal Reserve is hiking interest rates for the second time in three months.
The economy is improving, which means rates are on the rise. That in turn, will affect those hoping to payoff credit card balances sooner, people wanting to buy a car, and especially those thinking of buying a new home.
KDLT News is reporting that mortgage applications jumped more than 3 percent last week compared to the week before. All due to the fact that interest rates are on the rise.
Get it, while the getting is good.
According to the KDLT News report, the Sioux Falls Credit Union has seen about a three-quarter of a percent increase. Rates are in the neighborhood of 4.25% on a 30-year (fixed rate) term right now. That means it's roughly costing the average person around $60.00 more a month to buy a $200,000 home on a 30-year fixed rate mortgage.
Sioux Falls Federal Credit Union Mortgage Originator James Nytroe says, “Four to five months ago, you might have paid $926 a month, but with the recent increase in rates, you’re going to pay about $984 a month.”
Anyone that follows interest rates knows they've been historically low in recent years. But even with the Feds slight increase over the past few months, it's not dissuading people from buying.
Experts predict the Federal Reserve is going to raise rates two more times yet this year. The good news, however, even with the predicted rate increase, most people don't expect the rates to go higher than 4.3 percent on a 30-year fixed rate mortgage, and when you think about it, that is still a very attractive rate.
Source: KDLT TV