Buyers expecting lower mortgage rates will have to wait longer. (iStock)
Mortgage rates fell slightly this week, enough to rekindle homebuying momentum as the market prepares for this year’s traditionally busy season, Freddie Mac said.
The average interest rate on a 30-year fixed-rate mortgage for the week ending March 7 was 6.88%, according to Freddie Mac’s latest research. Primary mortgage market research. This was down from the previous week’s average of 6.94%. A year ago, the average interest rate on a 30-year fixed-rate mortgage was 6.73%.
The average interest rate on a 15-year mortgage was 6.22%, down from 6.26% last week and up from 5.95% last year.
A slight drop in borrowing costs led to a nearly 10% spike in mortgage applications, showing strong buyer interest as the market heads into the spring home buying season, according to the Mortgage Bankers Association’s latest weekly application numbers. ing. investigation.
“This week provided evidence that purchase demand remains sensitive to changes in interest rates, as applications rose for the first time in six weeks as interest rates declined,” said Sam Cater, chief economist at Freddie Mac. “Mortgage rates continue to be one of the biggest hurdles for potential home buyers looking to enter the mortgage market. Remember that interest rates can vary widely between mortgage lenders. Therefore, it is important to consider it carefully.”
If you want to refinance your mortgage to take advantage of current mortgage rates, or are ready to choose the best rate on your new mortgage, visit online marketplaces like Credible to compare rates and Consider getting pre-approved from multiple lenders.
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Market waits for interest rates to fall
The Fed has said it is still developing a plan to reverse rate hikes, but the timeline for when rate cuts will begin is unclear. Interest rate reversals are critical to creating more affordability for buyers dealing with record home price increases.
However, according to recent Redfin data, housing supply is improving. report. The number of new listings nationwide increased by 13% year-on-year in the four weeks ending March 3, marking the first significant increase in about three years. And housing prices also lost momentum. About 5.5% of home sellers lowered their asking prices, the highest share for February since at least 2015, while the share of affordable homes on the market increased, according to Realtor.com.
“Mortgage rates remain high and there is no sign that the Fed will lower rates significantly in the near term, so mortgage rates could fall significantly this year,” said David Sober, senior vice president at Boxster Analytics. is low.” statement. “If home prices are still rising across the board and potential home buyers are waiting for interest rates to drop, they probably won’t get the deal they want right away.”
Even if you’re looking to become a homeowner, shopping around can help you find the best mortgage rates. Visit Credible to compare options without affecting your credit score.
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Buyers must buy at the highest rate
Despite interest rates continuing to rise, homebuyers can save on borrowing costs by choosing the best interest rate from the right lender.
When mortgage rates are high, borrowers can save more by shopping around.According to Freddie Mac, changes in mortgage interest rates more than doubled in 2022 when interest rates exceeded 7%. the study. Assuming the loan is in force for at least five years, a borrower who shopped around five different interest rates could have saved him more than $6,000 over the life of the loan.
“Increasing interest rate dispersion means a wide range of mortgage rates are available to consumers with similar borrower profiles,” said Genaro Villa, macro and housing economics expert at Freddie Mac, in a research brief. Ta. “Given today’s interest rate environment, mortgage rates average around 6%, but many consumers who fit the same borrower profile will receive a better deal one day and be locked in at a 5.5% rate; On another day it could have been locked in at a 5.5% rate, which is closer to 6.5%. ”
If you’re ready to buy a mortgage or looking to refinance your existing mortgage, use the Credible Marketplace to compare rates and lenders and get a mortgage pre-approval letter in minutes. You can get
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