How Buyers Can Survive Rising Interest Rates

How Buyers Can Survive Rising Interest Rates   Here are three easy methods to deal with rising interest rates. “I want to purchase a home, but how can I deal with higher interest rates?” Many clients have reached out to ask me this question recently. In case you don’t know, the Federal Reserve recently raised rates by 75 basis points—the largest increase since 1994. Mortgage rates have already responded, and they’re likely to increase further throughout the year. Rates are still low historically, but there’s no denying that recent increases make it more difficult to purchase a home. If you’re looking to buy, what can you do?  Fortunately, there are tons of creative ways to adjust your strategy and prepare for higher rates, and I want to share three of them with you today: 1. Improve your credit. You may think your credit score is already as good as it can be, but there is always room for improvement. Start by paying off your debt little by little. This will lower your debt-to-income ratio, which is what lenders use to determine your creditworthiness. You can also save up for a bigger down payment to improve your credit and lower your rate. The results may seem small, but even a tiny difference can add up to a huge amount over the course of a loan.  “The longer you wait, the more expensive homes will become.” 2. Lock in your mortgage rate when it makes sense. If your lender is offering you a good rate, consider locking it in. Rates are expected to continue rising to combat inflation, but you won’t have to worry about that if your rate is locked in. Just remember that it only makes sense to lock in your rate when you’re almost to closing. Most rates only stay locked in for one to two months.  3. Pay mortgage points at closing. Also known as “discount points,” mortgage points are fees you can pay to lower your interest rate. One point typically costs 1% of your loan, so a point on a $200,000 mortgage would cost $2,000. A nice perk of mortgage points is that they might be tax-deductible. If you can deduct your mortgage interest, chances are you can deduct the cost of your mortgage points as well.  The truth is that it is still a great time to purchase a home. When the last Fed hike this large happened in 1994, rates were close to 8%, so our current ones look great by comparison. However, most experts believe rates will increase throughout 2022. On top of that, nothing indicates that rising mortgage rates will cause home prices to drop since inventory is so scarce. The longer you wait to purchase a home, the more expensive it will be.  If you’d like to take a look at what’s presently available on the market, you can view our multiple listing service here: Click here to see all available homes in your area. There are still plenty of opportunities in our market. If you have any questions about interest rates or purchasing a home, please call or email me. I am always willing to help!   Written by Ruby Miranda on November 28, 2022. Posted in Buyer TipsTags: Ultimate Home Buyers Guide Trackback from your site. Leave a Reply  

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Enjoy the Fall and the Thanksgiving Holiday

Enjoy the Fall and the Thanksgiving Holiday   Taking this opportunity to say Happy Thanksgiving to you and your family. Happy fall, everyone! I absolutely love fall weather. I love the breeze—not too hot but not too cold. This is the perfect time to take a walk and hang outside with the kids. The other thing I love about fall is Thanksgiving and the opportunity to say thank you to everybody in my life.  Thank you to my wonderful family for always being there for me, to my children who love me, to God who blessed me with my loved ones, to friends and clients who not only trusted me to buy or sell their homes, referred me to their friends and family, but also subscribed and watched my videos. I really appreciate that as well! Happy Thanksgiving, and I hope you enjoy the fall. Get out there, hang out outside, enjoy some roasted marshmallows, and enjoy some turkey on Thanksgiving. As always, if you ever need anything, feel free to call or send an email, even if it’s just to say thanks and hi. I’m always happy to hear from you!   Written by Ruby Miranda on November 11, 2022. Posted in Uncategorized Trackback from your site. Leave a Reply      

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Why Are We Seeing More Foreclosures?

Why Are We Seeing More Foreclosures?   What will happen now that the moratorium on foreclosures has ended? Are we about to see a tsunami of foreclosures and a struggling market similar to what happened in the real estate market crash of 2008? The short answer is no—foreclosures will start to increase again but not enough to worry over. Today I’ll go into more detail and explain why increasing foreclosures don’t spell doom for the market. At the beginning of the pandemic, many thought that a housing market crash would surely happen, but it didn’t. In fact, because of the combination of government support, low interest rates, and eager homebuyers, we experienced a housing boom. However, the various foreclosure moratoriums that protected people from financial disruptions during the pandemic are now ending. As a result, the number of foreclosures is now increasing again. “Frustrated buyers will eventually have more options available to them.” The number of foreclosure notices has increased by 219% since January 1. According to ATTOM Data Solutions, the number of properties that had foreclosure filings is up 153% compared to the same time period last year. Due to the tiny number of foreclosures over the last few years, the large increases we’re seeing now may look alarming on their own, but in context, this spike is a momentary blip as the market begins to normalize.  Rick Sharge, Executive Vice President of market intelligence at ATTOM, said, “Foreclosure activity across the United States continued its slow, steady climb back to pre-pandemic levels in the first half of 2022. While overall foreclosure activity is still running significantly below historic averages, the dramatic increase in foreclosure starts suggests that we may be back to normal levels by sometime in early 2023.” How are these normalizing foreclosure levels going to affect the market? 1.75 million homeowners are still protected by forbearance programs, but it would not take that many foreclosures to alleviate our extremely tight housing market. According to the National Association of Realtors, only 1.37 million units are currently available for sale, which is the lowest inventory level since data started being tracked in the 1980s. Frustrated buyers will eventually have more options available to them, but it will take many months of foreclosure increases for buyers to truly see a glut of inventory. If you have any questions about the end of forbearance programs, the rise in foreclosures, or anything else about our shifting market, don’t hesitate to reach out by phone or email. I’m happy to help.   Written by Ruby Miranda on November 1, 2022. Posted in Market UpdateTags: Foreclosures, Houston, Ruby Miranda Trackback from your site. Leave a Reply  

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