Here are two simple ways homebuyers can lower their interest rates.
Today, I'd like to share a few strategies to help you secure a lower interest rate. When navigating interest rates, there are ways to mitigate the challenges posed by our current high-rate market.
One consideration is the mortgage term. For those making substantial down payments, such as when selling a current home to buy a new one, exploring shorter-term options becomes viable. While the interest rate difference between the traditional 30-year term and a 15-year term is marginal, it's a worthy consideration, especially for those putting down a significant amount of money.
Another option to explore is an adjustable-rate mortgage. Unlike the risky ARMs seen before the financial crisis of 2007, these are fixed-term rates, usually 30 years, with the fixed part extending for the initial seven to 10 years, offering a lower interest rate. Many opt for this approach, anticipating a future drop in rates, allowing them to refinance within the comfortable seven to ten-year window.
"ARMs are best for buyers who can put 20% down."
It's important to note that ARMs are better suited for individuals with a larger down payment and might not be the ideal choice for first-time homebuyers. This strategy is often more applicable to seasoned buyers or high-income earners making subsequent property purchases.
While there's more to delve into on this topic, I'm here to answer any questions you may have. Feel free to call or email me for further clarification or guidance.