As you wait for rates to fall the competition will likely heat up. So, I say, go see a professional who is knowledgeable about police home loans and get pre-approved now to beat the rush.
When you see the headlines stating that the Fed cuts rates, the competition will already be there. The race will have already started.
Theoretically it’s great to wait as long as you can and try to pick the bottom for rates but there’s a saying that bottom pickers usually wind up with dirty fingers. Unless you’re some type of real genius who has a crystal ball you’re probably not going to know where the actual bottom is.
Our advice at Police Mortgage is to get ahead of the rate cuts and get a pre-approval. We’re going to prepare you for success. First responders, police in particular, should work with somebody that’s familiar with their livelihood. We, like all professionals that work for a patrolman credit union, understand their schedule and the demands of the job.
We love doing complimentary pre-approvals. A pre-approval doesn’t commit anyone to buying a house. It does, however, give our clients a clear idea of their monthly payment based upon today’s interest rates. That is important because it’s not just your interest rate, it’s how much it is going to cost you to be in a particular house.
When you get a pre-approval, you make sure you know what the numbers are. You understand where your cushion is. This is particularly true if you are looking for a property that might be higher priced or if you’re looking in an area that has higher property taxes or higher homeowner’s insurance costs.
In a lower rate environment more people qualify for a home purchase. That increases the competition. Since the majority of our customers are first-time home buyers we want our clients to learn about the process. That starts with the pre-approval. If a first-time home buyer wants to wait for a lower rate environment we are definitely going to ask why.
Rates definitely have a negative impact on monthly payments the higher they are. But the real question is, where are you at in your life? Or, where are you at in your career? We want to know what our clients see ahead of them in order to make a decision.
As a mortgage professional, I may tell somebody to wait. I may tell the next person not to wait because there’s a different set of circumstances. I think if you don’t have a home to sell and you’re a first-time home buyer you probably don’t need to wait because you want to get into a home. You want to establish some equity in that home by paying down the mortgage over time.
Interest rates eventually will start getting back to a normal range. When they do, you can refinance the property.
If you feel good about the monthly payment, if you feel comfortable, then the rate is somewhat irrelevant. I say that respectfully because I understand that every eighth of a percent on an interest rate makes a huge difference, but it also can’t be the reason why you don’t do something.
If you wait for rates to fall you may miss out on buying the property you want. But if have you have all the information in hand before you are ready to start making offers there will be fewer surprises when you want to buy a home regardless of where rates are.
Police Mortgage specializes in conventional mortgages, purchase money transactions, FHA loans, and VA loans. Led by founder and CEO John Aretos, Police Mortgage is known and respected for providing clients with exceptional service, customized terms, quick and easy closings, and low money down options. To learn more about Police Mortgage, call 312-499-8878.
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