In a New York Times article entitled Interest Rates Have Nowhere to go but Up, it is suggested that now is the time to buy as mortgage rates are not likely to get any lower for buyers looking to purchase in the Indianapolis real estate.
According to the article, after a historic 30-year decline in the cost of borrowing, interest rates are on the rise. The switch comes as no surprise, and is a natural facet of the ebb and flow of economics. Unfortunately though, the current rise in interest rates looks like it may continue for quite some time, at the very least through the end of the year when the 30-year mortgage rate is expected to hit six percent. This means that the small rebound that has begun to take shape is unlikely to last, and those looking to buy Indianapolis homes for sale will find it harder and harder to borrow the money that they need.
Thankfully, for buyers looking at homes in Indianapolis, interest rates on a 30-year mortgage aren’t going to come anywhere near their all-time high of 18.2% in 1981. A rate that high translated to a monthly payment of $1,523 on a $100,000 loan. To give a little perspective, the monthly payment on the same loan right now is $556.
Given that piece of information, clearly things could be worse, but that doesn’t mean that the situation isn’t bad for those looking to buy Indianapolis property. So what can home buyers do to better their chances of securing home loans?
The best piece of advice is do not buy unless you can afford to. If you’ve tried every option for a home loan and no one will give you a mortgage, you might want to take that as a sign that you’re not financially ready to invest in real estate. If you find you are in this situation, it may be worthwhile to discuss this matter with The Reel Team and figure out what measures you can take now so you can secure a home loan and purchase property in the future.
If you feel that you are truly ready to buy, choose your lender carefully for the best chance at securing a loan. Try to find a lender with a track record of excellent customer service who will answer all of your questions and make you feel comfortable. A Indianapolis mortgage lender that has the authority to approve your loan locally is ideal, because that lender will be most likely to know what the Indianapolis real estate market is actually like.
It’s also a good idea to know your credit score before you try to secure a loan. Equifax, Experian, or Trans Union will provide you with a free credit report through their simple request processes. Make sure the information in your credit report is accurate and do some research to figure out what you can do to improve your score that might mean reducing your number of credit cards or paying off your debt.
