The Federal Reserve has said it will keep it’s interest rates close to zero, but it wont stay this way for long. Homeowners have been quick to put their houses on the market since more and more buyers are on the prowl are on the hunt for a new place to call home.
Below are a few money moves to make while interest rates remain low.
Buy now and lock in a low rate
In the past 12 months, we have seen record low interest rates. Even today, some can still lock in a rate well below 3%, but for how much longer? Finding your dream home can take time, so why not start looking now if you are ready to make the move? Snagging a low interest rate now can save you thousands of dollars in the long run.
Since the beginning of Covid, homeowners have been running to their mortgage lenders to refinance their home loan. According to the data analytics firm, Black Knight, there were over 12.2 million homeowners who could qualify for lower interest rates on home loans in the month of June. Refinancing your home can provide you with a lot of advantages. From being able to lower your monthly payment, to even switching to a 15-year-loan, saving money in interest payments month after month.
Pay off existing debt
You can use a home-equity loan to pay off debt like student loans. Those with a student loan did get help thanks to the CARES Act (which currently stands through September). It is a great idea to continue to pay off student loans, especially since they are currently interest free. The quicker you pay this off, the less in interest you will have to pay.
Home Equity loans
A home equity loan allows you to borrow against a part of your home’s equity. Basically, it is a lump sum of the difference between the mortgage that you owe and your home’s market value. Now is a smart time to take out a home equity loan if you are doing big home renovations, or have a lot of high-interest debt, like credit card debt.
Invest in your space
Speaking of major home renovations, now may be a good time to invest in the add-on you have been thinking about, or the kitchen renovation you said you would one day do. Since a lot of Americans went most of 2020 without spending money on travel, eating out, etc. they have extra cash in their pockets. Now may be a great time to invest in your space (especially if you are wanting to get it on the market ASAP).
Swap Credit Cards
Currently, a lot of credit card companies are offering zero interest on balances you transfer over. In addition, a lot of credit card companies are hyping up their rewards and offers when you open a line of credit with them. If you are going to be spending a good amount of money soon, it may make sense to take advantage of these cards that have good rewards for spending a certain amount of money in a short period of time. (Of course, if you are looking to buy a home, this isn’t a great idea).
Looking for a lower rate on your current mortgage? Looking to consolidate debt? Looking to do home improvements or looking for a reverse mortgage? Ken Venick has over 35 years of experience in the real estate business and we are your one-stop-shop to handle all of your mortgage needs. Contact us today!