There’s no making the most of historic-low interest rates without understanding what they mean. This article will provide a brief primer illustrating the advantages that dipping rates can hold for new homeowners.
Seize the moment, homeowners. Low interest rates have smiled upon a real estate market desperate for recovery, and locking in one of these historic percentages could be a money-saving godsend.
As of February 2013, Freddie Mac has reported that 30-year fixed mortgage percentages are averaging a near-record 3.51% and approaching November’s lowest 3.31% rate since 1971. Meanwhile, 15-year fixed mortgages that month fell to 2.76% from 2.77%, edging near the 2.63% record low. March brought still more low interest rates, with a dip to 3.45% on 30-year fixed mortgages.
So, how to make the best of this?
Obviously, the best possible decision would be to either buy a home or refinance while numbers remain this low. Low interest rates like these are designed to spur recovery, and can’t be certain to stick around if/when the housing market bouncing completely back. Still, as with any major credit-related decision, consider all factors before thinking about signing on the dotted line. Even near-historic low interest rates like these could sabotage you if you already have a honey of a rate that you could forfeit if you refinance now. Remember too that any mortgage, no matter how sweet is still a debt. You may be in a position wherein you can’t afford any new debt whatsoever, even a low-interest one.
Read more: How to Take Advantage of Dipping Rates
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