on Wednesday, August 8th, 2012 at 10:37am.
What you may or may not know in all that's said about real estate in Idaho, and elsewhere, is that buying a home is more affordable than it has been in generations. Interest rates are at unheard of levels, (as of August, they are around 3% for 15 and 30 year fixed-rate mortgages) which is one of the main reasons why it costs less to buy a home today. This opportunity comes to us after going through the difficulty of yesterday's recession. Learn about exactly why you can buy a home because of the amazingly low interest rates.
Interest Rate Consequences
Obviously the interest rate on your home mortgage is how much you pay the bank for lending you the money. The importance of the interest rate can be forgotten among all the other aspects of buying a home, but its effects are quite vast. CNN.com did a calculation of what you would pay now versus what you would have paid in 2006 with the interest rate at that time and it is a difference of $700 monthly on the same loan! An average home with 20% down, according to their calculations, now costs only $600 a month. Many Boise residents can afford real estate in Idaho, because of the savings from the low interest rates. This is especially helpful for the first-time home buyer and someone looking to own a second property for themselves or to invest. Interest rates could go drop even further, but many experts don't expect it to happen as the economy is getting stronger, but if it does, there's always the option of refinancing. You can look at your options when closing and sometimes paying more then can lower your rate even more.
Getting a Loan
You may have heard that with tightening standards it's difficult to get a loan today, which is true. Lenders are being more careful to make sure that the borrower will be able to pay the loan, considering debt-to-income ratio and many more factors to determine how much someone can qualify for. However, getting a loan is not impossible for most, and there are programs in place that help lower income and first time home buyers. Speak with your Realtor and lender for more information to see if that applies to you, as it is helping many buyers today.
Buying a Home
Competition for real estate in Idaho has really increased in recent times, making it a bit difficult to find and close on a good home--especially because the current low housing inventory. Many are seeing that low interest loans and high probability of appreciation has made it a great time to buy. As a buyer in today's market, you will need a Hughes Group real estate professional to make sure you understand how to win with real estate in Idaho. They will give you professional, individualized attention to make sure you can find a great home, without being afraid to fight through multiple offers on your dream home.
Compare types of loans and rates among different respected mortgage companies and get pre-qualified so you can begin your real estate in Idaho search! Interest rates can't stay this low forever. Don't wish you would have taken advantage of this opportunity--start working with your buyer agent today!