If you are venturing out to buy a home in Merrick, we are sure you are probably quite excited! After all, searching for the home of your dreams is certainly something to look forward to.
However, it is also important to keep in mind that you will need to be prepared for your home-buying experience, as many tasks will need to be completed in order to make it happen.
Previously, we presented information about some current real estate trends that deal with how the housing market is when it comes to inventory, along with the prices of homes. This week, for part three, Massapequa real estate agents here at Kim Holland Homes are going to be informing you about another real estate trend that deals with mortgage interest rates. So, if you are all set to discover some helpful insight, be sure to continue reading:
- What are Mortgage Interest Rates? First off, it’s important to understand what a mortgage interest rate is. In general, it is a percentage of your total loan balance, which will be paid on a monthly basis, along with your principal payment, until your loan is paid off. Overall, it is a fee that lenders charge as a percent of your loan amount, and what it costs you each month to finance your home.
- How Do Mortgage Interest Rates Work? Interest rates are determined by calculating a percentage of the mortgage amount, and then the payments are structured so that the interest is paid off quicker, meaning that the bulk of mortgage payments in the first half of your mortgage term mainly goes towards interest. However, as time goes on, more of the mortgage payments will go towards the principal, and less towards the interest.
- Current Trend – Mortgage Interest Rates Are Low. Right now, interest rates have actually beenvery low, as the average rate for a 15-year fixed-rate mortgage dropped to around 2%, which is the lowest it’s been since Freddie Mac started reporting nearly 30 years ago.
- Rates for Buyers. Seeing as interest rates are low right now, it will certainly help buyers with affordability if you are to buy a home in Merrick. However, it is important that you keep in mind to not feel pressured into purchasing a home even if the rates are low, as a low interest rate on house you still may not be able to afford could result in a bad deal. So, as long as you remember to stick to your budget, by efficiently budgeting for a comfortable monthly payment, down payment amount and the right mortgage type, you will be in good shape!
- Rates for Sellers. If interest rates are to remain low, it is also great for sellers, as buyers will be more motivated to buy a home in Merrick sooner rather than later! However, it is also important to remember that interest rates could start to rise throughout the year. If this happens, you may be able to take advantage of the low rates and shorten your payment schedule by refinancing your mortgage.
Being knowledgeable about mortgage interest rates is certainly of importance! We hope that this information has provided you with some helpful insight.
Would you like to buy or sell a home of your own with a real estate agent in Massapequa, New York? If so, please take a moment to get in touch with us here at Kim Holland Homes, as we are all set to work with you! In addition, remember to keep an eye out next week for part four of our real estate trends article.