After years of decline to rock-bottom levels, interest rates are on the rise. The average rate for a 30-year mortgage was recently 4.35%, more than a point above the 2012 low of 3.3%
1. No more record rates, but still cheap loans
If the economy continues to improve as anticipated, rates will keep inching up.
2. The refi window is starting to close
The rate bump is already cooling off refis, but most homeowners with the equity and stellar credit to refinance have already done so. The average credit score for approved mortgage.
3. Higher rates won’t scuttle the housing recovery
A healthier economy is what’s boosting prices. Rates would have to rise sharply to make a mark.
4. Once you’re ready to buy, lock in
To avoid any short term spikes, lock in as soon as you can (typically when you sign a contract). Most lenders won’t charge for a 45-60 day rate lock. Pay for a 90-120 day lock only if deals close slowly where you live.
5. Fixed loans usually beat adjustables
An ARM is the better call only if you plan to own your home for a short time.