Understanding the Impact of Rising Mortgage Rates on Homebuyers
The average US mortgage rate is currently at its highest level in 23 years, but individual rates can vary significantly depending on the borrower's financial attributes and risks. Factors such as credit score, debt-to-income ratio, employment history, payment track record, and down payment amount all play a role in determining the mortgage rate. Borrowers with higher credit scores, lower debt ratios, stable employment, and larger down payments are generally considered lower-risk and can secure lower rates. Shopping around and obtaining quotes from multiple lenders can help borrowers find the best rate, and buying down the rate with discount points or making a larger down payment can also reduce monthly costs. Lenders are prohibited from considering factors such as race, religion, and age when determining mortgage rates.