On Tuesday, the average 30-year fixed mortgage rate jumped back up to 7.34%. That coupled with home prices that rose dramatically during the pandemic, and in some markets, are still rising, has deteriorated affordability. It’s pricing buyers out of the market, at a time when supply is already constrained as would-be sellers hold on to their low rates. Something’s got to give, but until then, shopping around for your mortgage rate can help.
Shopping for mortgage rates isn’t as simple as it used to be, certified mortgage advisor and senior vice president at Vellum Mortgage, John Downs, tells Fortune. A lot of people call lenders to say they want to buy a home and want to know what the lender’s mortgage rate is on a 30-year fixed. The response isn’t so simple, Downs says, because it depends on that person’s credit score, down payment, property type, income, and whether or not they’re a first time buyer.
“To shop today, there needs to be either a legit conversation or someone that knows all those data points to then give to a lender, like ‘hi I’m a first time homebuyer I make less than $100,000 a year, my credit score is 780, I’m buying a condo in D.C…’ it needs to be almost that specific,” Downs says.
All those factors can vary depending on the loan type. If you’re calling a lender about a FHA loan and the rate for the day, they’ll likely be able to give you an answer pretty quickly, Downs says. Whereas with conventional loans, virtually everyone gets the same rate if you’re putting 40% down, Downs says.
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Source: finance.yahoo.com
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