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Mortgage rates are still falling. Here are 5 big moves to make now
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The past couple of years have been tough for homebuyers. Just a few years ago, it was easy to find a mortgage loan with a 3% (or lower) rate, but as buyers rushed to take advantage of the cheap borrowing environment, it fueled an uptick in demand and drove up home prices. As the mortgage rate environment shifted post-pandemic, mortgage rates climbed, significantly reducing affordability and pushing many prospective buyers to the sidelines.
It appears that there’s finally a glimmer of hope on the horizon, though. In recent weeks, mortgage rates have shown a promising downward trend. Right now, the average mortgage rate is below the 7% threshold, with 15-year mortgages averaging 6.41% and 30-year mortgages averaging 6.92% (as of July 15, 2024). This offers a welcome reprieve for potential homebuyers, even in today’s tight housing market, where inventory remains limited.
But while this shift in the mortgage landscape is positive news, navigating the homebuying process in the current market still requires careful planning and strategic moves.
Find out the best mortgage rates available to you now.
Mortgage rates are still falling. Here are 5 big moves to make now
For those looking to take advantage of the cooling mortgage rate environment, here are some key steps to consider:
Get preapproved for a mortgage loan
One of the most crucial steps to take in today’s competitive housing market is to get preapproved for a mortgage loan. This process involves a lender reviewing your financial information, including income, assets and credit history, to determine how much they’re willing to lend you. A preapproval letter not only gives you a clear idea of your budget but also demonstrates to sellers that you’re a serious and qualified buyer.
In a market where multiple offers are still common, having a preapproval can set you apart from other potential buyers. It shows sellers that you’ve already taken steps to secure financing, which can make your offer more attractive. And, the preapproval process can help you identify and address any potential issues with your credit or financial situation before making offers.
Compare your top mortgage loan offers online now.
Lock in the best rate you can find
With mortgage rates on a downward trend, this is an opportune time to lock in a favorable rate. A rate lock guarantees that the interest rate quoted by your lender will remain available to you for a specified period, which typically spans from 30 to 60 days. This can protect you from potential rate increases while you complete the homebuying process.
But don’t just lock in the first rate you’re offered. Shopping around and comparing offers from multiple lenders is crucial during the process. And, don’t hesitate to negotiate with lenders, as even a small difference in your interest rate can translate to significant savings over the life of your loan.
Consider buying points to lower your rate further
If you have some extra cash on hand and want to ensure that you’re getting the best mortgage rate possible, buying mortgage points could be a smart move in the current environment. Mortgage points, also known as discount points, are essentially prepaid interest that you can purchase upfront to lower your interest rate for the life of the loan. While it can vary, each point typically costs 1% of your loan amount and can lower your rate by about 0.25%.
Rates are still relatively high by historical standards, so buying points could provide substantial long-term savings if you plan to stay in the home for an extended period. However, it’s important to calculate the break-even point to ensure this strategy makes financial sense for your situation.
Act fast on desirable properties
While the cooling of mortgage rates is a positive development, it’s important to remember that the housing market remains competitive due to limited inventory in most markets. And, as rates continue to drop, more buyers who were previously priced out of the market may re-enter, potentially intensifying competition for available homes.
If you find a property that meets your needs and fits your budget, be prepared to act quickly. Have your finances in order, your preapproval in hand and be ready to make a competitive offer. That way, you can set yourself up for success.
Explore alternative loan options
While conventional 30-year fixed-rate mortgages are the most common, don’t overlook other loan options that might be more suitable for your situation. For example, adjustable-rate mortgages (ARMs) typically offer lower initial rates than fixed-rate mortgages. And, in a falling rate environment, an ARM could potentially save you money in the short term, with the option to refinance to a fixed-rate mortgage if rates continue to decline.
The bottom line
As mortgage rates continue to cool, it offers a window of opportunity for prospective homebuyers who have been waiting on the sidelines. And, by taking proactive steps such as securing a preapproval, locking in competitive rates, considering points purchases, acting decisively on desirable properties and exploring various loan options, you may be able to position yourself for success in today’s evolving housing market. While challenges remain, particularly in terms of inventory and overall affordability, the improving rate environment could make it easier to turn your homeownership dreams into reality.
At least 11 employees were taken to hospitals and residents were urged to shelter in place on Tuesday after an explosion at a Louisville, Kentucky, business.
The Louisville Metro Emergency Services reported on social media a “hazardous materials incident” at 1901 Payne St., in Louisville. The address belongs to a facility operated by Givaudan Sense Colour, a manufacturer of food colorings for soft drinks and other products, according to officials and online records.
Louisville Mayor Craig Greenberg said emergency teams responded to the blast around 3 p.m. News outlets reported that neighbors heard what sounded like an explosion coming from the business. Overhead news video footage showed an industrial building with a large hole in its roof.
WLKY-TV
“The cause at this point of the explosion is unknown,” Greenberg said in a news conference. No one died in the explosion, he added.
Greenberg said officials spoke to employees inside the plant. “They have initially conveyed that everything was normal activity when the explosion occurred,” he said.
The Louisville Fire Department said in a post on the social platform X that multiple agencies were responding to a “large-scale incident.”
The Louisville Metro Emergency Services first urged people within a mile of the business to shelter in place, but that order was lifted in the afternoon. An evacuation order for the two surrounding blocks around the site of the explosion was still in place Tuesday afternoon.
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A rare square 37-carat emerald owned by the Aga Khan fetched nearly $9 million at auction in Geneva on Tuesday, making it the world’s most expensive green stone.
Sold by Christie’s, the Cartier diamond and emerald brooch, which can also be worn as a pendant, dethrones a piece of jewelry made by the fashion house Bulgari, which Richard Burton gave as a wedding gift to fellow actor Elizabeth Taylor, as the most precious emerald.
In 1960, Prince Sadruddin Aga Khan commissioned Cartier to set the emerald in a brooch with 20 marquise-cut diamonds for British socialite Nina Dyer, to whom he was briefly married.
Dyer then auctioned off the emerald to raise money for animals in 1969.
FABRICE COFFRINI/AFP via Getty Images
By chance that was Christie’s very first such sale in Switzerland on the shores of Lake Geneva, with the emerald finding its way back to the 110th edition this year.
It was bought by jeweler Van Cleef & Arpels before passing a few years later into the hands of Harry Winston, nicknamed the “King of Diamonds.”
“Emeralds are hot right now, and this one ticks all the boxes,” said Christie’s EMEA Head of Jewellery Max Fawcett. “…We might see an emerald of this quality come up for sale once every five or six years.”
Also set with diamonds, the previous record-holder fetched $6.5 million at an auction of part of Hollywood legend Elizabeth Taylor’s renowned jewelry collection in New York.
