Home Buying, Part 2: Waiting on Interest Rates

If you’re waiting for rates to come down before you buy, read this first.

What a rate actually is

Your mortgage rate is what it costs to borrow money for 30 years. Nobody knows what money will be worth in 30 years, so the rate is everyone’s best guess about inflation and the economy, right now. It moves every day and will keep moving up and down. Anyone who tells you exactly where it’s going is guessing.

The 2 things that set your rate

1. The market. Nobody controls that. Not you, not your lender.
2. You. Your credit, your down payment, and your debt. That part is all yours.

Stop watching rates and work on the part you can actually move.

About refinancing later

Yes, you may be able to refinance if rates drop. But plan your payment as if you never will. Don’t take a mortgage you can’t afford because you’re counting on a refinance. It might happen. It’s not a guarantee.

Previous: Part 1, the 90 days before a lender. Next: Part 3, your pre-approval isn’t your budget.

What I actually use: Fidelity for investing, the Amex Gold for everyday spending, and the rest on my What I Use page.

General education, not advice for your situation.