We all would love to save money on our home mortgages. This much is apparent to current homeowners and potential homebuyers alike. However, what many might not know is that the opportunity to do so might be slipping away with each passing day. That interest rates on home mortgages have been increasing since December and many prominent real estate analysts are saying that the mercury might very well continue to rise into 2011. That being said, current homeowners might want to seriously think about jumping on any plans that they had to refinance their mortgages, while those looking to buy should start getting more serious about their decision.

For those looking to buy a new house or condominium, however, there are a few things that you should consider before you lock yourself into one of these low, but steadily rising interest rates. Realize that the savings from these low rates are actualized over years, not months. That being said, don’t think that they are your saving grace or what is going to make your dream of being a homeowner a reality. Your monthly payments will be lower if you lock into one of these rates; but never skip the absolutely essential step of assessing your present and future finances before making the monumental decision to become a homeowner.

Your credit score should also be taken into consideration before you decide to act on the steadily rising interest rates. Many of the rates you see are calculated based on excellent credit scores; so if you’re still paying off pizzas that you bought for your friends in college these interest rates might not apply to you.

Lastly, you have to figure out how much you are able to put down on the purchase of your house. If your finances are not permitting of a significant down payment, no interest rate is going to save you from the sizeable monthly payments you’ll receive as a result.

For current homeowners looking to lock into a lower rate by refinancing closing costs should be your primary concern. Consult a real estate expert to see if your potential savings from these lower rates are greater than the costs of refinancing.

Interest rates on mortgages are at historic lows and are on the rise. Be prudent—but at the same time don’t miss this opportunity to potentially save thousands before it vanishes into 2011.

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This is filed under Home Loans/ Mortgages.

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