Over the past week, we’ve seen mortgage interest rates drop to historic lows. Last week, Freddie Mac announced the lowest rates ever in the history of the lender. The average new rate of 2.98% for a 30-year fixed-rate mortgage has been in response to concerns about the state of the economy and its resurgence in many parts of the country. But, as always, it’s more than just meets the eye, particularly since the rates that are being promoted will not be the reality for all applicants.
Great for Some People
These new historically low rates, no doubt, will be great news for many people who have the financial ability to qualify and may have been on the fence about buying a new home or refinancing their existing one. The best rates will be available for those who have been able to maintain employment with stable earnings, have stellar credit scores and who would normally be considered top-tier borrowers.
But for many people who are struggling with job losses and furloughs and the inability to keep up with monthly household payments, getting qualified for these mortgages will be next to impossible. So, it’s important to consider your own financial situation before you get too optimistic.
How Long Will These Rates Be Around?
How long will these extremely low interest rates be around? It’s difficult to say.
Fannie Mae, Freddie Mac and the Mortgage Bankers Association all have their own teams of economists who have been monitoring the economy and making predictions about the future. As each look beyond the immediate future into the coming year, their forecasts are not all on the same page.
Interestingly, Fannie Mae seems the most optimistic while Freddie Mac and the Mortgage Bankers Association predict that rates may trend upward again. This merely suggests that nobody knows what will really happen or when it will happen and that it is still anyone’s guess.
Tougher Than Usual to Get Approved
It stands to reason that during unsettling economic times, lenders are reluctant to take much risk. Consequently, there can be large differences in qualifying criteria and rates now from lender to lender.
For a borrower, that can be extremely frustrating to shop for the best value in a mortgage product. In addition, many lenders are now adding restrictions to the loans they offer. Borrowers who are looking for a jumbo loan, a mortgage for an investment property or even a cash-out refinance may find them particularly hard to get. This is even more reason to shop extensively for a mortgage.
Liberty Capital Services is Your Columbus Mortgage Broker
Liberty Capital Services can help you decide which mortgage product or lender fits your individual financial profile in these strange times. They work with many different institutions with many different products and are able to offer shopping convenience that would be almost impossible going from lender to lender in this changing market. Call Liberty Capital Services today at (614) 505-0620 and let them help you find the best mortgage financing in Ohio.