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Mortgage rates have trended down recently and are holding steady today. 

Rates have increased dramatically throughout most of 2022, pushing the typical monthly mortgage payment further out of reach for many cash-strapped buyers.

According to the Mortgage Bankers Association, the median mortgage payment applied for by applicants increased to $2,012 in October. Monthly mortgage payments are up 38.1% year-over-year.

“Higher mortgage rates are also squeezing the purchasing power of prospective buyers,” Edward Seiler, MBA’s associate vice president of housing economics and executive director of the Research Institute for Housing America, said in a press release. “The median loan amount last month decreased to $295,000 – the lowest level since January 2021. Weakening affordability and increased economic uncertainty are expected to slow homebuying activity in the final two months of the year.”  

As the economy cools, rates should start to drop further in the new year, which is good news for borrowers who are having trouble finding affordability in the current market.

Today’s mortgage rates
Today’s refinance rates
Mortgage calculator

Use our free mortgage calculator to see how today’s interest rates will affect your monthly payments:

By clicking on “More details,” you’ll also see how much you’ll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.

Are HELOCs a good idea right now?

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Many homeowners gained a lot of equity over that past couple of years as home prices increased at an unprecedented rate. But because rates are so high now, tapping into that equity can be expensive. 

For homeowners looking to leverage their home’s value to cover a big purchase — such as a home renovation — a home equity line of credit (HELOC) may still be a good option. 

A HELOC is a line of credit that lets you borrow against the equity in your home. It works similarly to a credit card in that you borrow what you need rather than getting the full amount you’re borrowing in a lump sum. 

Depending on your finances and the type of HELOC you get, you may be able to get a better rate with a HELOC than you would with a home equity loan or a cash-out refinance. Just keep in mind that HELOC rates are variable, so if rates start to trend up further, yours will likely increase, as well.

Mortgage rate projection for 2023

Mortgage rates started ticking up from historic lows in the second half of 2021 and have increased over three percentage points so far in 2022. They’ll likely remain near their current levels for the remainder of 2022.

But many forecasts expect rates to begin to fall next year. In their latest forecast, Fannie Mae researchers …read more

Source:: Business Insider

      

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