How COVID-19 Has Impacted the Mortgage Industry
September 3, 2020
First Family Credit Union
Homeowners are typically getting mortgages due to new home purchases or when they are refinancing an existing mortgage to get lower monthly payments. For those that are looking to get lower rates, now is a great time to apply for a new mortgage during this “new-norm” due to COVID-19.
What is the Impact COVID-19 has had on Mortgages?
Before COVID, interest rates on mortgages were at historic lows. With the state of the current pandemic, it was found that during June 2020, the average for a fixed-rate 30-year mortgage reached a low of 2.97%, making interest rates even lower than they were pre-pandemic. Lower interest rates result in lower monthly payments, making it ideal for potential homebuyers. As a result of these rates, the housing market has seen a fast recovery, with mortgage applications up by 13% during the month of June.
If you’re looking to take advantage of the current interest rates here are some ways to start:
1. Do Your Research
Find the mortgage rate that is right for you and your situation by creating a list of potential lenders. Stay flexible and patient in order to find the best option.
2. Get Prequalified
Getting pre-qualified is always a smart financial decision when house hunting. Given the current state of the real estate market, it is especially ideal to get pre-approved to give you a competitive edge in the negotiation process. Looking to get pre-approved? We can help!
3. Gather the Required Documents in Advance
Once you’ve decided on a lender, prepare all the documents that you will need for the process. These are some of what you’ll need:
- Recent pay-stubs
- Two years’ worth of federal tax-returns and W2s
- Proof of funds for down payment
- Recent residential history
- Credit score
- Outstanding debt value
- Insurance contact information
- Past employment history
Get Started on Your Homebuyer Journey
Family First Credit Union is here for you during these times. Contact us today and talk to one of our Mortgage Experts to start on your home buying journey!