MOLINE, Ill — If you're looking to buy a home in the Quad Cities, and are worried about mortgage rate hikes, there are tips to follow to hopefully lessen the burden on your budget.
Mortgage rates in the U.S. reached 8%, the highest since 2000. This hike coming after months of rate increases. The federal reserve increased mortgage rates to fight higher inflation. FreddieMac says the feds also raised mortgage rates for five consecutive weeks.
According to the Mortgage Brokers Association, applications have fallen to their lowest since 1996.
According to NerdWallet, you can ask the seller to reduce the mortgage rate. Homebuyers can use what's called a temporary mortgage rate buydown. It's where the seller pays a portion of the buyers interest payments upfront. This can reduce your house payments for up to the first few years of ownership.
The finance company also says not to wait for a rate you like better. If the right house comes along and the payment is affordable, even if you don't like the interest rate, you should buy the house.
You can find more tips for homebuyers dealing with high mortgage rates by clicking/tapping the NerdWallet link above.
News 8's Charles Hart spoke with the President of Mel Foster Co. in the Quad Cities, Lynsey Engels about the local impact of the rate hike and tips for homebuyers.
"We're not necessarily seeing it as much in the Midwest as what we are, you know, when you watch the news, and you see things about, you know, stories on the East coast, in the West Coast," Engels said. "You know, we're a little bit more insulated."
"You've got your mortgage brokers, you have your credit unions, and you have your banks, and all of them are great options for finding loans," Engels said. "But I think it's good to talk to all of them and make sure that, you know, you're finding a mortgage broker and lender that is from a credit union and from a bank as well, just because they can all offer different incentives at different times."
Engels also said buyers need to make sure they're getting pre-approved.