With purchasing a new home, whether it be your first home or not, one of the main things that you may be wondering is what a good interest rate truly is. While there is no magic answer to this question, many homeowners, real estate experts, and lenders have all discussed the topic and given their opinions on the matter. Interest rates can fluctuate nearly daily as the real estate markets shift and change, so it is important to lock in a rate when you find one that you are happy with.
The year 2020 has seen historically low interest rates which has left the housing market booming and homeowners scrambling to re-finance their loans to secure the lower rates. A decade ago, a “good” rate was considered anything below 5%, although most loans that were approved with good credit would be approved for roughly 4.75% whereas back in 1995 rates could be found as high at 9.5% interest even on applications with good credit scores.
Needless to say, today’s rates are not only highly appealing to buyers, but also homeowners. Pending on the type of loan, such as a 15 year or 30 year, fixed rates, credit scores, down payments, etc. you can find interest rates as low as 2.35%. With rates so low now is a better time than ever to invest into a new home. As a general rule of thumb, within the last few years professionals have stated that any interest rate that is below 4% should be considered a “good” rate and generally will be offered to those who have higher credit scores.
In conclusion, while you can’t easily answer the question at hand, it seems to go without saying that today’s rates are hot and many real estate professionals are busy with both new and repeat clients. It is important to remember not to settle or an agent and always do your research to find a qualified agent who can work with you and assist you along your real estate journey. Whether you are looking to lock in a new rate through a refinance, purchase your first home at a great rate, or simply upgrade or downsize, now is the time.