Buy a house now or should I wait?

One of the things homebuyers are always asking themselves is buying now versus waiting. Mathematically it could pencil out that buying a house down the line might make more sense, but you should pay close attention to all the financial contributors in your life so you can make the most informed decision possible…

The lay of the land right now interest rates are at incredible all-time lows. Long-term fixed-rate mortgage money is in the mid-3% range and potentially could go even lower if you’re willing to pay discount points and have excellent credit. This is something that you should not overlook. The last time interest rates were at these levels was in 2012. Prior to that, there was no other time in US history where mortgage rates were at the levels that are presently at.

Additionally, purchasing the house now will afford you the ability to purchase something with very little competition. It depends on each house of course, but on average you might be going to get up against one or two other offers. In the summertime, you’ll have more choices, but the competition will be greater. We also don’t know what interest rates are going to be over the summer, but it’s been said that the average 30 years fixed-rate mortgage will remain sub 4% throughout the duration of 2020.

How you determine the best time to buy a house should have nothing to do with interest rates or competition or with availability or with scarcity on the market. Granted those are all important things, but the number one most important thing to be focused on is your finances. When you purchase a house the number one thing you should be focused on beyond anything else is that mortgage payment it, drives affordability. You want to pay close attention to the mortgage payment and your ability to save after your mortgage payment and other monthly obligations are already met. You need to be able to save money regardless of whether you buy a house or not. If that is in place and you’re feeling good about your job and you’re feeling optimistic about your finances and your income is stable to rising to pull the trigger. Here’s why- if you’re going to be buying a house and you have a long-term plan in place 5-7 years or longer even if this is not the perfect home the equity appreciation, and tax advantages weighed out over the course of time when compared to renting is significant.

If you’re thinking about buying a house and really need some direction talk to an experienced lender who can walk you through a budget if you don’t already have. Creating a budget and sticking to financial responsibility is the first step in pursuing a big high ticket item like homeownership.

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RELATED MORTGAGE ADVICE FROM SCOTT SHELDON

When buying a home, it’s natural to want the lowest mortgage rate possible. But sometimes, chasing a slightly better rate from another lender—especially after your offer has already been accepted—can backfire in a big way. Let’s walk through a real-world scenario. You’ve got an offer accepted on a house. You’re working with a lender who has you approved, documents in underwriting, and a 21-day close of escrow in place. Everything is moving forward. Then you hear from another lender offering a rate that’s 0.25% lower, with slightly better closing costs. It’s tempting. But before you make a jump, here’s what you need to consider. Switching Lenders Comes with Time Costs When you pivot to a new lender mid-contract, they’ll need to: Re-underwrite your entire loan, Order a new appraisal, Disclose and sign new loan documents, Submit the file for final loan approval, Schedule and fund closing—all over again. This doesn’t happen overnight. Even in ideal circumstances, the new lender is likely going to need at least 25–30 days to close. If you’re in a fast-moving or competitive market, this is a real problem. Most sellers won’t grant a contract extension just because you’re switching lenders. So, what happens next? A Contract Extension Can Jeopardize Your Deal Asking for a contract extension means the seller must agree to delay closing. But that delay introduces risk—especially if the seller has backup offers or simply wants certainty. They may not grant the extension. Or worse, they could cancel the deal outright and take another buyer’s offer. Even if the seller agrees to extend, your earnest money and negotiation power could take a hit. And for what? A slightly lower rate that might save you $50 to $75 a month? Mortgage Rates Aren’t as Far Apart as You Think Here’s the truth: all mortgage lenders get their money from the same place—the bond market. The pricing differences between lenders usually range from 0.125% to 0.25% in rate on any given day. If one lender seems to be offering dramatically better pricing, the first thing you should ask is: How? Head over to FreddieMac.com and check the average 30-year fixed rate posted weekly. This is one of the most reliable benchmarks for where rates truly stand in the market. If a lender is quoting you a rate that’s well below that average, ask for the details: Are they charging extra points? Is this a teaser rate with a prepayment penalty? Is it based on a different loan product or risky structure? Often, what sounds “too good to be true”… is. Consider the Bigger Picture Think long-term. If you’re financing $600,000, a 0.25% lower rate may reduce your payment by roughly $75/month. But what if you lose the house and have to start over? That monthly savings doesn’t mean much if you’re outbid on your dream home or lose your deposit. Also, remember: you’re not going to keep this rate forever. Today’s homebuyers typically refinance when rates drop by about 0.75% or more. So if rates fall within the next year or two, you’ll likely be refinancing anyway. Instead of paying extra points now or risking the entire deal for a minor monthly savings, it may be better to accept a slightly higher rate—knowing you’ll refinance when the time is right. The Real Risk Isn’t the Rate—It’s the Delay When shopping for a home loan, don’t just ask, “What’s your rate?” Ask: Can you close on time? Is this rate sustainable or based on hidden costs? Will switching lenders delay or jeopardize my contract? A home purchase contract is a binding agreement between you and the seller to perform within a set timeframe. If you can’t meet those dates because you're chasing a slightly better rate elsewhere, you may want to reconsider if now is the right time to buy. Final Thoughts Yes, interest rates matter. But execution matters more. Before making a switch mid-transaction, talk to your lender. Have an honest conversation about pricing, timelines, and strategy. You might find that staying the course, securing the house, and planning to refinance later offers a better path to financial security. Want to Know Your Options? Let’s compare rates and strategies the smart way—without risking your dream home. 👉 Click here to get a custom rate quote today.

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