Preparing for your home purchaseby Tim Manni
There are some obvious do’s and don’ts when it comes to homebuying:
- Do: Shop around for the best mortgage rate
- Don’t: Give out your social security number to every single person who asks for it
- Do: Get preapproval
- Don’t: Sign or agree to anything you haven’t read or are uncomfortable with
But preparing for a home purchase needs to go beyond just the basics. Preparation takes months, even a year. The good news is that mortgage rates have hovered over historically-low territory for quite a long time now. A long stretch of stable-to-falling rates allows potential homebuyers the time needed to research, plan and execute a transaction to buy a home without concern of a spike in rates, which can upset deals at a moment’s notice.
According to HSH.com’s Weekly Mortgage Rates Radar, rates on the two most popular types or mortgages barely moved off record lows. The average rate for conforming 30-year fixed-rate mortgages rose by a single basis point (0.01 percent) to 3.88 percent, just above record lows. Conforming 5/1 hybrid ARM rates increased by 2 basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.88 percent.
“Record and near-record low mortgage rates are providing important support for the housing market,” says Keith Gumbinger, vice president of HSH.com. “Both existing and new home sales are starting to move upward. However, buying a home doesn’t happen overnight, and successful transactions begin many months before they came to fruition.”
Unlike refinancing, Gumbinger explains, buying a home requires much more time to plan and prepare before move-in day arrives. For potential homebuyers, there is work to be done as far in advance as one year if they hope to have a trouble-free transaction.
To help first-time homebuyers every step of the way, HSH.com has just introduced the First-Time Homebuyer Timeline, a 12-month planning guide for the process.
“The decision to buy a home starts a number of processes rolling, and the clock starts ticking,” notes Gumbinger. “Knowing what steps to take today and what comes next in line will alleviate stress and confusion. HSH.com’s new tool provides a simple way to see what needs to be accomplished and when, helping to make the process smoother and easier. Mortgage rates will be low for a while yet to come, but not forever, and the time to start planning a home purchase is now.”