On The Market

August Mortgage Rate Update & Should You Buy/Refi Now?

Aug 26, 2024

Caeli Ridge, a knowledgeable lender and returning guest, shares her insights on the current mortgage rate landscape. She explains why rates are decreasing despite the Fed holding rates steady. Listeners will learn about opportunities for investors as rental property interest rates dip into the high sixes. Caeli also discusses the pros and cons of paying points on mortgages and the potential impact of economic trends on future rates. With Caeli's expert perspective, you'll have a clearer picture of whether now is the time to buy or refinance.

30:36

Creator website

Episode guests

Caeli Ridge

AI Summary

AI Chapters

Episode notes

Podcast summary created with Snipd AI

Quick takeaways

Mortgage rates are declining, creating opportunities for investors, with rental property loans now reaching favorable rates in the high sixes.

Understanding the impact of the Federal Reserve's statements on market sentiment is crucial, as anticipatory movements can influence mortgage rate shifts before official cuts occur.

Deep dives

Current Mortgage Rates and Factors Influencing Them

Recent changes in mortgage rates indicate a positive trend for investors, with rates dropping from around 8% to 7% for investment properties. The federal funds rate currently stands at 5.25%, which influences but does not directly equate to mortgage rates. Key factors affecting mortgage rates include loan characteristics, such as occupancy type, credit scores, and loan sizes, evidenced by the example of a $200,000 investment property that currently offers a rate of 6.99% with specific conditions. The significance of Loan Level Price Adjustments (LLPAs) is highlighted, as these adjustments can vary based on a borrower's qualifications and loan specifics, affecting the final rate they receive.

Intro

2min

Understanding Mortgage Rates and Fed Impact

7min

Navigating Investment Opportunities Amidst Changing Rates

3min

Understanding Mortgage Rates and Economic Influences

6min

Understanding Mortgage Points and Refinancing Trends

7min

Current Mortgage Rates and Ref refinancing Insights

6min

Mortgage rates are falling, but the Fed hasn’t made any rate cuts yet. What’s the deal? We’re explaining it all in this August mortgage rate update with repeat guest and lender-friend of the show, Caeli Ridge. Caeli fills us in on today’s mortgage interest rates, why rates are moving without any federal funds rate cuts happening, what could cause rates to go even lower, and whether paying points on your mortgage makes sense in the current market.

Good news for investors: interest rates are getting into the high sixes for some rental property loans, but lower rates aren’t always a good thing. With the economy slowing down and inflation (thankfully) seeing some significant progress, unemployment is rising, and better interest rates may come at the cost of a worse economy. But this isn’t a surprise, no matter how unfortunate it is for many workers in today’s market.

We’re getting Caeli’s take on the Fed’s next moves, today’s mortgage rates, and what’s in store for future rates. This is crucial commentary from a lender working on loan products for investors in today’s exact interest rate environment, and hearing her may change your next investing move. Dave also gives his opinion on the mortgage rates we could expect to see next year and whether buying or refinancing even makes sense now.

In This Episode We Cover

August 2024 mortgage rate updates and where investor interest rates are right now

Why mortgage rates have been falling WITHOUT the Fed lowering their rates

Paying mortgage points and whether or not it’s worth it if rates are continuing to fall

The BIG uptick in refinancing and purchasing activity since rates began to fall

Where Dave thinks mortgage rates could be next year

And So Much More!

Links from the Show

Join the Future of Real Estate Investing with Fundrise

Join BiggerPockets for FREE

Find Investor-Friendly Lenders

See Dave at BPCON2024 in Cancun!