Unpacking Home Loan Options In A High-Interest Rate Market
Rising mortgage interest rates have some buyers assuming their dream home or investment property is out of reach. News programs casting a dim light on the future of home loans only adds to consumer uncertainty.
So, what are your mortgage financing options during a high-interest rate market? Should you wait to purchase? The good news—let’s make that “the great news”—is home buyers have multiple financing opportunities.
Whether you work remotely, dream of an Alpine getaway, a sleek downtown condo, new construction, or a valley ranch, we’re pulling back the curtain on home financing to help you make educated decisions and sound home investments.
A Champion In Your Corner:
Your first step is contacting a real estate advisor and lender. Together, they will craft a plan of action that respects your budget, timing, and goals. A real estate agent is your frontline advocate, protecting your interests and ensuring every detail of your home purchase is carefully executed. Realtors are tuned in to local market trends and under-the-radar buyer opportunities, providing you with peace of mind.
Explore Lending Products:
Many financial service providers have responded to higher interest rates with new products.
“We have more creative financing options than I’ve seen in years,” said Bryan Wallpe of Movement Mortgage Incline Village, Lake Tahoe. “The key for buyers is working with a mortgage advisor who can analyze their current financial position, make recommendations to minimize interest cost while maximizing tax benefits, and ultimately help the buyer determine the best course of action.”
Partnering With A Seller
Some home buyers can assume an existing home loan, often with a lower interest rate. According to the Consumer Financial Protection Bureau, “Most loans backed by the Federal Housing Administration (FHA), the U.S. Department of Veterans Affairs (VA), or U.S. Department of Agriculture (USDA) can be assumed.”
“For the Reno, Carson Valley, and Incline Village market, we are seeing more sellers contribute to buyers closing costs, states Edee Campbell, Sales Associate with Sierra Sotheby’s International Realty. “This allows buyers to reduce lending fees or secure a lower interest rate.”
And while many Lake Tahoe purchases tend to be cash-based, sellers understand that offering a concession can attract more qualified buyers.
Bridging The Gap:
Another winning alternative is seller financing, which can be quicker and cheaper than traditional loans—offering flexible interest rates and terms. This can bridge the gap for buyers trying to secure long-term financing. Understanding the ins and outs of seller-financed home purchases can expand your possibilities for purchasing today.
From luxury gated neighborhoods, lakeside condos, and 55+ communities bursting with amenities, the Reno/Lake Tahoe region is constructing new home developments. Local and nationally recognized builders are motivated to move their products and often offer loan incentives through their preferred lender and/or a reduction in sales price.
If you’re looking for a new-build home, ask your real estate advisor to register you at the development before you arrive, as it will benefit you through the process.
While no one can predict the future, we do know that home prices continue to rise. Rather than trying to “outguess” the market by waiting and more than likely paying more for your next home, let’s look at today’s possibilities. A simple conversation can clear the financing haze and give you the green light to secure your next home. By exploring lending options and working with a qualified realtor, you could hit the slopes and gather around the holiday table in your new home—sooner than you think.
“Don’t wait to buy real estate. Buy real estate and wait.” Robert G. Allen