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Should Bernal Home Buyers Lock in at a Low Mortgage Rate Today? Here's What You Need To Know
The average rate on 30-year home loans has dropped below 3%, which is the lowest it's ever been since the rates were first tracked in 1971. You've likely heard the news.
Many analysts predicted the COVID-19 pandemic would decimate the housing market, but all around the country the opposite has happened. Mortgage applications are trending upwards as people want to buy their first home or refinance interest rates.
As a homeowner or prospective home buyer, you're probably thinking: Should I lock in my mortgage rate today?
Keep reading below to learn about why now is a great time to get a deal in real estate.
How COVID-19 Has Affected the Real Estate Market
The current home market is opening up opportunities for certain kinds of buyers. But, the fact is the economy is struggling through the pandemic and it will take some time to rebound.
Even before COVID-19, higher home prices made it tough for buyers in San Francisco. There has been a growing shortage in housing inventory since the 2008 crash.
So far this year, home prices have stayed steady, while interest rates are at a historic low.
The virus has also made it difficult to visit potential homes. Most agents now use virtual home tours to target specific audiences, save time, highlight key features, and more.
Should I Lock in My Mortgage Rate Today?
Now is a great time to purchase a home if you are a certain kind of buyer:
- You have cash saved for a down payment
- You're flexible about a closing date
- You can demonstrate strong job security
The timing is perfect for qualified first-time buyers and real estate investors in Bernal Heights to capitalize on rock-bottom mortgage rates.
As a buyer, your most important consideration should be job security during COVID-19. Are you confident that your office won't be closed or you won't be laid off? If the answer is no, it's likely not the right time to buy.
Taking Advantage of Current Refinance Rates
Another option provided by low rates is for homeowners to refinance their current loan.
While the average rate is under 3%, it is important to remember that mortgage bank rates differ from lender to lender. Some may be 2.8% while others could be 3.1%. It always pays to shop around.
Refinancing can get you lower monthly payments, a shorter loan, or more home equity. But, you'll want to use a refinance calculator to make sure you'll benefit in the long run.
It all depends on your "break-even" point and the total length of your original loan. A few bad calculations can result in losing money. Double, triple, quadruple-check the details!
Don't Miss Your Chance to Buy or Refinance
If a Bernal buyer asked "should I lock in my mortgage rate today?" our answer is a resounding: "What're you waiting for?" Don't miss your chance! Not even the experts can predict when rates will jump back up, although they are likely to stay low for quite some time due to slow economic recovery nationwide.
If you have questions about the Bernal Heights real estate market, please don't hesitate to reach out.
Contact us any time!
