If you are someone who is sitting on fence hoping to buy a house in late spring or early summer it might be time to hop off that fence and buy sooner before the fence gets a whole lot higher…. mortgage interest rates on both conventional and government loans are set to go up in the spring.
Even before the scheduled April 1st date released by Fannie and Freddy, lenders will be pricing in the new higher agency conforming “G” fees on their rate sheets. No one knows for sure how high rates will rise when this happens but what is certain is that rates will increase for the standard conforming loans used by the majority of homebuyers beginning in March 2014. The “G” fees or guarantee fees are what Fannie and Freddie charge each lender and bank that send their conforming loans to them.
By increasing the cost for lenders to move their loans through Fannie and Freddie , Washington hopes to force more private sector money into the mortgage market which has been dominated by the government sponsored agencies. The effect will be most greatly felt by the borrowers in the largest section of America’s homebuyers, those will credit scores between 680 and 759 with 5 to 20 % down although even those with greater down payments will see increased costs as well.
To avoid these higher costs and rates buyers who have been planning to move forward need to act now. Get with your real estate agent and find the home of your dreams so that you can lock in a rate before Spring when the increases are sure to start rearing their ugly head ! Call us today for pre-approval to get the ball rolling.
For more information on how these changes will affect you or to get started call Jimmy Polakovich @ 616-774-9160 x 237