June 8, 2023
In the last 12 months, many have speculated about the state of the housing market. We all wonder about when an expected recovery might happen and how quickly we can start reaping the benefits.
Before we launch into speculation about the future of FHA loan mortgage rates, it’s a good idea to discuss expectations and how to plan ahead for buying your future home.
When Is It The Right Time To Buy A Home?
Are you in the planning and saving stages of your home loan? If you are, there’s no reason to speed up that process. just because you expect things to improve in the next quarter of 2023.
The same is true for those about to move out of the planning and saving part of the process.
If you are moving into the house-hunting stage, the same advice applies. Since there no way for you to realistically predict what may happen with rates and home prices the smart thing to do is to be cautious, shop around more aggressively for a lender and a new home, and hope things improve along the way.
Home buying is a process you should not rush.
Your goal should be to get your credit and finances into good shape. Deciding when and how to commit to a home loan will be easier when you find the right home, price, and lender even if rates are still high.
You can always ask about prepaying, mortgage rate discount points, and adjustable-rate mortgage loan options.
What’s Ahead For Mortgage Rates?
Going into 2023, many predicted that rates would begin dropping this year and that by the third quarter of the year, we would experience improvement in mortgage rates and housing market improvement in general.
But in the last month of the second quarter mortgage rates are still above seven percent, and the talk as Q3 approaches isn’t as promising as predicted last year.
FHA Loan Mortgage Rates: When Will They Fall?
That is what everyone wants to know in the wake of a series of interest rate adjustments by the Fed. Those adjustments are not specifically tied to mortgage loan interest rates, but such increases made it costs more for lenders to loan money.
Higher single-family home loan mortgage rates are the response to that cost increase.
The Fed raised lending rates in May 2023 but issued some mixed messaging about future hikes, stating at first that they expected future increases but later deleting that phrase from its messaging.
That leads some in the mortgage industry to speculate that a rate hike pause is possible. Such a pause could be a factor in rates beginning to fall.
But at the time of this writing, that is speculative. For now, we should expect more uncertainty in rates and their futures until we see lower rates happening consistently over a longer period of time. For now, market volatility still seems to rule the rates.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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