Now is a great time to buy a home. Skeptical? With unbelievably low home prices and mortgage rates, those sitting on the sidelines for the bottom to hit are missing deals of a lifetime that will never come again. And for a limited time…don’t miss out on the day-to-day deals available throughout the mortgage market.
Now is the best possible time for the home buyer (or for sellers to offer as promotion) permanent interest rate buy downs. Historically to buy down the rate of your mortgage permanently would cost on average a spread of 4 points for 1%, but right now the average spread on mortgage rates is about 2 points for 1%. These point to percentage spreads are changing every day, but the time has never been better.
What this means in simple terms is that if the purchase price of a house is $200,000, if the rate was bought at 1 point lower, it would save the buyer on average 10% on their monthly payment. That savings is incredible. If your monthly payment was $1,100 before the buy down, your payment after the buy down would be approximately $990. Over 30 years on a conventional loan, that is a savings of $40,000. What could you do with $40,000?
This won’t last forever! With yield spreads being so compressed on rates, now would be a great time to buy. It's like a mortgage sale for anyone who qualifies.