Today’s Mortgage and Refinance Rates: Dec. 25, 20,22

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Mortgage ratesAfter trending down over recent weeks, rates have held steady and most forecasters expect rates to continue falling throughout 2023.

The economy is cooling, and inflation has been slowing down over the past few months. It’s possible we will experience a mild downturn in 2023 which would cause mortgage rates to drop further.

Today’s mortgage rate

Today’s refinance rate

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Use our free mortgage calculator to see how today’s interest rates will affect your monthly payments:

Click on “More Details” to see the total amount you will pay over the length of your mortgage. This includes how much goes towards principal and interest.

Are HELOCs a good idea?

Many homeowners have gained substantial equity in the past two years, as home prices rose at an unprecedented pace. However, accessing that equity can be costly because of the high rates. 

For homeowners who are looking to leverage their home’s value to cover a big purchase — such as a home renovation — a home equity line of credit (HELOC) may still be a good option. 

A HELOC is a line credit that allows you to borrow against the equity of your home. It works in the same way as a credit card except that you only borrow what you need, and not the entire amount you borrowed in one lump sum. 

Depending on your financial situation and the type of HELOC that you get, you might be able to get a better rate using a HELOC than with a mortgage. home equity loan or a cash-out refinance. Keep in mind that HELOC rates can fluctuate so if rates trend up, yours may also.

Projected mortgage rates for 2023

The second half of 2021 saw historic lows for mortgage rates. They have risen by over three percentage points since then. They will likely stay at their current levels through 2022.

Many forecasts predict that rates will begin to fall next fiscal year. They are able to access their latest forecastFannie Mae researchers predict that 30-year fixed rate will trend down in 2023 and 2024.

However, whether mortgage rates drop in 2023 will depend on whether the Federal Reserve can control inflation.

The last 12 months have been the Consumer Price Index rose by 7.1%. This is a significant decrease in inflation when compared to earlier in the year. This could indicate that mortgage interest rates may begin to drop soon.

Mortgage rates could fall even further if the Fed acts too aggressively, or engineers a recession. Current forecasts don’t expect this to happen. However, rates won’t fall to the historic lows that borrowers have enjoyed over the past few years.

When will house price drops?

However, home prices are slowly falling. we likely won’t see huge dropsEven in a recession, you can still do it.

The S&P Case-Shiller Home Price IndexPrices are still rising year-over-year even though they decreased on a monthly basis in August and July. Fannie Mae researchers predict that prices will fall 1.5% in 2023. MBA forecasts a 0.7% increase for 2023 and 0.1% for 2024.

Many buyers are hesitant to buy homes because of sky-high mortgage rates. This has led to a slowdown in homebuying and a downward trend in home prices. However, rates could begin to fall next year which would relieve some of the pressure. The current supply of homes also is low. historically lowThis will likely keep prices stable.

What happens to house values in a recession.

However, house prices tend to fall during recessions. It does happen when less people can afford homes. This forces sellers to lower their prices.

How much mortgage can you afford?

A mortgage calculator can help you determine how much you can afford to borrow. Try out different home prices and down payments to get an idea of how much your monthly payment might be. Also, consider how it fits into your overall budget.

Experts recommend that you spend no more than 28% on housing expenses. This means that your total monthly mortgage payment, which includes taxes and insurance should not exceed 28% your pre-tax monthly income.

The lower your rate is, the more you can borrow. Shop around. get preapprovedWith multiple mortgage lendersSeek out the best rate to get you started. You should not borrow more than your budget can afford.