Is now the time to buy or sale a home? This is probably the most popular question when considering a purchase or sale. Getting top dollar for your home and paying the lowest interest rate possible is the goal. There are many factors to be considered if the timing is right. Since everyone’s situation is different, some thoughts to be considered are down payment, employment, credit history, reserves when financing a home, home appreciation and current interest rates.
Required down payment will vary on the loan program and eligibility. Down payment can vary from 0%, 3.5%, 20% or more. Each program has restrictions and eligibility requirements that should be discussed with your lender. Employment stability is a factor. A recent job change in a new a profession could be problematic. However, if in the same line of work and guaranteed pay scale, a lender may have a solution.
Credit scores and credit history will have an impact on the interest rate offered and ultimately the loan approval. It is a good idea to look at your credit report prior to looking for homes. The lender may have suggestions on simple ways to improve your score if needed. Having some money left over after closing is called reserves. The lender will want some reserves available after closing in order to handle unforeseen expenses. Therefore, planning for down payment and reserves is a consideration.
Additional considerations for a home purchase or sale is the current appreciation level. The national appreciation level forecast for 2017 is 5%. Locally, Boulder is expected to see 5.6% appreciation. Appreciation levels will vary with the supply and demand of homes. The interest rates are an important factor as well. The lower the interest rate, the higher the buying power. The current 10 Yr Treasure yield is 1.8708% at time of this article and expected to be 2.1% by year’s end. This would indicate an increase in interest rates. The Federal Reserve Chairman, Janet Yellen has indicated in recent comments, there will be additional increases on the Prime lending rate. So is now a good time to buy or sale? The appreciation of homes is at a healthy pace and the interest rate environment is low. As long as the factors listed above are in line, it could be a good scenario to consider.
Carrie Nash, Loan Officer
SWBC Mortgage Company, Boulder, CO
So there you have it! Ultimately, it is completely up to you whether you are ready to buy and sell. You have been given the information, and now it’s time to make a decision!
If you are looking for a lender in Boulder County, I highly suggest Carrie. She is so smart, knowledgeable of the market, and just a fantastic person.
Until next time!