Wow - that headline from Business Week sure grabbed my attention.
Interest rates are at historic lows but cyclical trends suggest they will soon rise. Home buyers may never see such a chance again, writes Marc Roth of Business Week.
He goes on to write, "Well, you may not be stupid or broke. Maybe you already have a house and you don't want to move. Or maybe you're a Trappist monk and have forsworn all earthly possessions. Or whatever. But if you want to buy a house, now is the time, and if you don't act soon, you will regret it. Here's why: historically low interest rates."
The average 30-year fixed-rate loan with no points or fees has been around 5%. Rates are so well below historic averages that it should make all current and prospective homeowners take notice of this once-in-a-lifetime opportunity.
Roth puts this into historical perspective:
"First, rates have far further to move upward than downward; for more than 30 years, 7% was the low and 18% the high. The norm was 9% in the 1970s, 10% in the mid-1980s through the early 1990s, 7% to 8% for much of the 1990s, and 6% only over the last handful of years.
Second, the last time the long-term trends reversed from low to high, it took more than 20 years (1970 to 1992) for the rate to get back to where it was, and 30 years to actually start trending below the 1970 low."
Roth continues to illustrate how a 2% interest rate increase will cost a homebuyer an additional $48,000 for every $100,000 borrowed over the course of a 30-year fixed-rate loan.
For the full article, click here.
For more detailed information about local rates in the DFW market, call Eileen Austin at Home Team Mortgage Company.
Interest rates are indeed at record-breaking lows. If your credit is not clean, it's time to get the soap out!
