Will the Fed Interest Rate Increase Affect Mortgage Interest Rates?

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If you own a home or you are preparing to buy a real estate property, then you are probably watching the interest rate trends and how these changes are affecting the industry. The Fed had a meeting this week, and the announcement was as expected: Fed interest rates are going up by .25%, which is the same increase that they’ve used at all of the meetings in recent years.

Connection Between Fed Rates and Mortgages?

Lloyd Mize

Just because the Fed announced that the rates are going up, this announcement doesn’t have a direct impact on mortgage interest rates. Some homeowners mistakenly think that there is a direct connection.

Sometimes, a Fed rate increase can have a strong impact on various economic drivers. So, we might see indirect factors that change mortgage interest rates. But, there are other times when the indirect effect of the announcement is barely noticeable. Don’t jump to conclusions and assume that your interest rates will increase on your home mortgage. Instead, you need to talk to a mortgage professional for personalized information.

Interest Rates You Can Expect When Buying a Home in Temecula

If you are preparing to buy a home, then what can you expect with the interest rates? We’ve seen the trend that interest rates are increasing right now. But, that doesn’t mean that there aren’t any opportunities with a real estate purchase. Home prices are also increasing, giving homeowners access to great equity right now. There’s no doubt that homeownership is a great investment due to the strong economy and rising real estate prices.

Since the interest rates are trending upwards, the best strategy is usually to lock in the rates as soon as possible when buying a home. Work with a real estate agent to find the right property, and make sure that you have pre-approval documentation ready. This information needs to be prepared so that you can submit an offer on the home as soon as you locate the property of your dreams. Then, your mortgage company can help you lock in the interest rates when you are ready to close on the deal.

You don’t need to navigate the real estate industry without support from a professional team. If you want to buy or sell a home in Temecula, then it is essential that you call Lloyd Mize at The Lloyd Mize Realty Group at (951) 551-1677