This year has caught many of us unprepared, resulting in unexpected circumstances in nearly every industry. The real estate industry is no exception. Even as the Federal Reserve cuts short-term rates and pumps money into the mortgage finance system to deal with this instability, there are still plenty of considerations you need to take into account when thinking about buying your dream home.

The Reason For The Rate Drop

In order to ensure the stability of the real estate market, the Federal Reserve decided to cut the rates on all existing mortgages subsidized or guaranteed by the government. Since then, the federal funds rate has remained near zero, with central banks promising not to raise mortgage rates again until they are confident that the economy has survived and recovered the current circumstances.

This was to lighten the load on the average person. Many people have already lost much during this year, and this was a way to help people to get lower mortgage payments by allowing homeowners to refinance into a lower monthly payment and to help people who are purchasing to receive a lower monthly payment.

Why is This Necessary?

In times of economic uncertainty, the market can behave in unpredictable ways. The US government did not want a complete financial disaster, so, by cutting the cost of money helped the housing market.  Home sales are now at record highs.

These recent financial injections not only make it easier for people to retain ownership of their homes, it makes mortgages and other financing plans for buying a house more accessible to an aching market. This gives everyone who was suffering the weight of the these trying times a chance to buy a home even amidst economic uncertainty.

What I Need To Know About Refinancing in 2021

Plenty of homeowners have decided to refinance, so many lenders are faced with heavy workloads and more complicated approval processes. As such, it would do you well to lighten the load by submitting a complete application with all the necessary documentation.

It also helps to understand what your refinancing goals are. Are you looking to get a lower monthly rate? Shorten your loan term? Replace your adjustable-rate mortgage with a fixed-rate loan? Are you seeking to borrow more than you own in a cash-out refinance? These are just some of the questions you need to ask so you and your lender can agree on mutually beneficial terms.

Buying A Home or Refinancing with Steelman Mortgages

2020 has brought plenty of uncertainty in nearly every aspect of life. Not only have we been forced to stay indoors to stave off the spread of this disease, but we have also been subject to an unstable market and rising prices. As such, it is important to keep abreast of all the important decisions of the federal government, as they can help you make the right choices about your future and prepare for what’s coming more easily.

If you’re looking to refinance, buy a home, and so on, give Steelman Mortgages a call at (916) 847-7263. We can provide you with all the best mortgage options. There’s nothing we love more than helping people achieve their desired lifestyles and obtain their dream home.