LIME REALTY GROUP likes to keep an eye on the current mortgage rate.  It helps us determine how busy we’re going to be and if the market is leaning towards buyers or sellers.  For quite some time now, it’s been a buyers market in Southern Utah.  With rates hanging around 4% buyers have had more leverage as their dollars are simply more valuable.  

However, times they are a changing.  We’re slowly seeing that rate start to increase and as it does, the value of your home buying dollars decreases.

Of course it may seem like it’s not a huge deal when you consider the rate usually doesn’t move quickly and the difference can be literally less than an entire percent.  For example, the current rate for a 30-yr fixed mortgage is 4.20%…  Last week, that rate was 4.19%.  So the actual movement on the rate is .01%.  While that doesn’t represent a huge difference in the strength of your buying credit, it will effect the amount of money you pay each month for your mortgage.  Maybe that .01% is only $1 a month when you calculate it in, but depending on how large your mortgage ends up being, it could be more.  And what happens if the rate spikes overnight?  Let’s say it goes from 4.20% to 5.20%…  That could raise your monthly payment by quite a bit.  Depending on the size of your mortgage, a move that aggressive can have huge consequences.  

That’s why we always encourage our buyers to lock in a rate.  When you know what you’re dealing with, you have a better chance of making a decision that will have the exact outcome you expect.  At least as far as price is concerned.

Whatever you do, if the rates seem intimidating, stop by Lime and let us help you see how they effect you and how knowing this stuff will help you buy the home of your dreams!