The domain of mortgage rates is rife with its own ebbs and flows. While the rates may seem high today, they could skyrocket further tomorrow. Today, in the financial limbo, we witness an intriguing turn of events which poses a significant question for potential homeowners — should you lock in a mortgage rate now, with the interest rates being temporarily paused?
As the financial and property markets hold their collective breaths, the benchmark interest rate sits at a 22-year peak of 5.25% to 5.50%. This upper-limit will hold steady at least until the final Federal Reserve meeting of 2023. So, what does this pause mean for prospective homeowners or those seeking to refinance their existing commitments? Is this the opportune moment to lock in your mortgage rate?
Why The Pause Could Be Your Cue?
- Buying Time to Compare: When interest rates rise, there is a hasty scramble, a rush to secure a mortgage before the prospective rates are introduced. However, this pause is akin to a pressure relief valve, offering potential borrowers more time to compare mortgage rates, understand the terms, and make an informed choice without the looming threat of an imminent rate hike.
- Avoid Future Shock: An old saying advises, “A bird in the hand is worth two in the bush.” The rates may not seem ideal now, especially when compared to the low rates of previous years. But consider this — was the 2020 interest rate any better when compared to that in 2019? The idea is, the 8% that you secure now might look far more appealing when compared to possible rates post another Federal Reserve meeting.
- More Options Up Your Sleeve: The mortgage market is not just a single-lane highway; it offers several routes to get to your destination. This pause gives you time to examine options like adjustable-rate mortgages, buying mortgage points to possibly lower your rate, or exploring the opportunity of an assumable mortgage if the property you’re interested in offers that.
Taking the Plunge
While mortgage rates are undeniably high, it’s crucial to remember that good timing can play a pivotal role. This fleeting period of financial detente offers potential buyers an extra window to investigate, negotiate, and potentially bag the lowest rate they can manage until the economy fully recovers from inflation.
Homeowners can also use this juncture to explore other lesser-known strategies to obtain a lower than average rate.
The options may not look as bright as they did just a few years ago, but remember that in this sea of higher interest rates, any layer of advantage can prove beneficial.
And if you’re looking for mortgage brokers within the GTA, be sure to check out:
The 5 Best Mortgage Brokers in Markham
The 6 Best Mortgage Brokers In Oakville
The 5 Best Mortgage Brokers in Richmond Hill
The 5 Best Mortgage Brokers in Vaughan
Don’t miss out on the chance to lock in your rate today; hold the reins of your financial future! Embark on your journey of exploring mortgage rate options today!