The stock market's ups and downs lately have been affecting mortgage rates in interesting ways. Here's what you should know if you're looking at home financing options.
30-year fixed rates have been surprisingly steady despite earlier predictions of increases. When investors get nervous about stocks, they often move money to bonds, which helps keep mortgage rates in check. Last week, rates briefly hit their lowest point in months before edging up slightly.
This creates an opportunity if you're house hunting. While rates are higher than the 2020-2021 lows, they've stabilized enough to make your monthly payments more predictable.
The advantage of choosing a 7/1 ARM isn't what it used to be. Currently, these adjustable loans offer rates just 0.3-0.5% below 30-year fixed ratess, much smaller than the typical 1-1.5% discount we've seen in the past.
With such a small difference, it's worth questioning whether the modest initial savings justify the uncertainty of rate adjustments later, especially in today's unpredictable economy.
Making Your Move
If you're actively looking for a home, this period of relatively stable mortgage rates amid market volatility could work in your favor. You may want to consider locking in a rate when you find the right property, as these stable rates might not last.
For those thinking about an Adjustable-Rate Mortgage, carefully consider whether the small upfront savings truly outweigh the risk of rate increases after the fixed period ends.
If you need personalized rate information, I'm happy to connect you with a mortgage advisor who can provide quotes tailored to your situation. Please email me at [email protected].
Posted on April 11, 2025
