Columbia SC housing is facing what some financial experts call "very concerning circumstances" when it comes to rising mortgage rates.
Peter Tchir of TF Market Advisors, a New York research, asset management, and consulting firm, puts it quite simply, "Rising rates are bad, particularly bad when it comes to one of the bright spots for the U.S. economy: housing."
How Rising Rates Affect Columbia SC Housing
Recent increases in mortgage rates adds roughly $90 to $100 onto the monthly mortgage payment for the typical $250,000 house. Rates for a 30-year fixed mortgage tend to track the 10-year Treasury rate very closely. Yields on the 10-year Treasury note hit their highest level in more than a year recently.
Although rates remain very low based on historical standards, Tchir thinks this is significant headwind for potential buyers who have been on the fence. And he counts a lot of people in that category given the lack of growth in high paying jobs during the economic recovery. Tchir points out much of the job growth post-recession has come from lower paying, service-oriented industries or in temporary services.
As for housing, mortgage applications (particularly for refinancing) have dropped in recent weeks. Tchir thinks we could see a real slowdown exacerbated if and when the Federal Reserve begins to taper its bond-buying program, which would remove support for Columbia SC housing.
Rates are likely to keep rising, but how far must rates rise before buying a home starts to look expensive relative to renting? At today's prices and rents, buying would be cheaper than renting until the 30-year fixed rate reaches 10.5%. At current 30-year fixed rates according to Freddie Mac, buying is 41% cheaper than renting nationally. With a 5% mortgage rate, buying is still 34% cheaper than renting nationally.
So even though rates for buying Columbia SC housing is on the rise, it's still a lot cheaper than renting. Contact us today for current rates and available inventory of homes for sale.
Columbia SC mortgage rates have topped 4 percent for the first time in over a year, while at the same time, mortgage applications fell more than 11 percent. Diana Olick reports on how rising Columbia SC mortgage rates may impact the housing recovery.
Economists are still cautiously bullish on real estate for two main reasons. First is the fact that near-record low Columbia SC mortgage rates have made home buying more affordable, even with the recent run-up in rates. The second is all the pent-up demand in the housing market after years of sluggish sales.
As was noted in the interview, even rates at 4 percent or so are still near historic lows, and seeing rates go up may be a temporary thing.
We will ever see 3 percent mortgage rates again? It's anyone's guess, but most experts think not. So now may be the cheapest time to think about getting a Columbia SC mortgage as opposed to sitting on the fence and waiting for rates to go back down, which they may or may not ever do.
For more on Columbia SC mortgage information, check out the other articles we have under Columbia SC Real Estate Articles in the column to your right, and stay tuned to this website as we constantly keep you up to date on Columbia SC mortgage news and real estate information.
Your credit score operates on the assumption that the near future will look a lot like the recent past, and that going forward, people can be expected to behave pretty much as they always have.
Since most people will exhibit the same basic behaviors for years at a time, be they good or bad, it's not hard for the people who build credit scores to analyze you and your expected patterns of future behavior. If you have bad credit today, it only stands to reason that you'll have bad credit tomorrow.
So just how important is your credit score? Janet Bodnar of Kiplinger's Personal Finance magazine explains…
Making sure your credit score is high is super important
This is especially true if you plan to borrow money to buy a home. Here are three more tips on improving your credit score fast from Stacy Johnson of Money Talks News…
Here is that website Stacy mentioned where you can get a free copy of your credit report to see what your history says about you. Go to http://www.AnnualCreditReport.com
You can get a copy of your credit report free from each of the three major credit reporting agencies each year. So get one now, then get another 4 months from now, and the third four months after that. This way, you can be checking on your credit report every four months for free, and not wait a whole year to see what's going on. For the most part, with a few minor exceptions, all three credit reports will have basically the same things listed about your credit history.
Columbia SC home buyers 
have been flocking to the market in droves this past year, trying to take advantage of affordable prices and record-low mortgage interest rates while they still can.
When it comes to applying for a mortgage — the most important aspect of the home-buying process — recent surveys found that about one in three buyers have no idea what they're doing.
In today's market, where the low supply of listings and bidding wars require swift decision-making, it's pretty unsettling that few buyers come in well-prepared. And considering the fact that the housing crisis was largely attributed to homeowners who took on mortgages they couldn't afford, buyers apparently haven't learned many lessons.
Columbia SC Home Buyers Need Education
Here are some key findings from the recent unrelated reports by Zillow and the Yale Law Journal study:
- One-third of about 1,000 potential buyers who took Zillow's Mortgage IQ Survey did not know they could get a mortgage with less than 5 percent down. (The minimum down payment for FHA loans is 3.5 percent and VA loans can be obtained with zero down.)
- One-third of buyers incorrectly believe that all lenders are required by law to charge the same fees for credit reports and appraisals.
- 26 percent of buyers thought they were obligated to stay with the lender that pre-approved them (not so) while 24 percent believed the best interest rates and fees are only obtained through their own bank (again, not true).
- The Yale study, conducted over three years, also found that 31 percent of its participants did not understand the basic principals of a mortgage, and many didn't even bother to read the terms of the documents they were signing.
- Nearly one-third of participants who read a lender disclosure form didn't know the loan being presented had an adjustable rate, despite the fact that the form clearly specified so.
If you'd like to see how prepared you are to join the ranks of Columbia SC home buyers, take Zillow’s 10-question mortgage quiz.
Get more mortgage information by checking out the mortgage related articles under Columbia SC Mortgage Info to your right.
If you're like many people these days, either thinking of buying Columbia SC real estate, or refinancing your current mortgage, there's a lot you have to consider before doing either one. But before you get too busy thinking about how you'll spend the money you'll save by refinancing, or what your dream home might look like, stop for a minute and make sure you'll actually qualify for a mortgage by not making these credit score mistakes.
There are dozens of factors that, well, factor into qualifying for a mortgage such as setting your limit, your rate, etc. One of the big indicators of what you'll qualify for is your credit score. This is one of the initial pieces of information a lender will use to determine if they can help you.
Your credit score is a good indicator of what kind of financing you'll be able to get. One way to start off on the wrong foot is to apply for a mortgage without having an idea of where your credit score is on the scoring scale.
Contrary to popular opinion, a soft credit pull – the kind you'd be doing if you were just checking up on your credit yourself – won't negatively impact your credit score.
It's a good rule of thumb to check your credit score on your own about once a year, but you'll want to check it a few months before you apply for a mortgage so you'll have time to build it up or make repairs if it's too low.
Check Your Credit Score
There are a lot of different companies that will generate a credit score for you. Quizzle.com is one very reliable website for checking your credit. It offers free credit reports and scores, helps you to understand what everything means and helps you build your credit.
Once you get your credit score, it's important to understand what that number means for you, and, if it's low, how to boost it. Generally speaking, 580 is the absolute lowest score you can have and still qualify for a mortgage – an FHA mortgage, specifically. Usually, you need at least a 620 to qualify. If you're at 720 or higher, you'll be in a lower mortgage rate bracket because you're thought of as a pretty worth-while risk for the lender. 780 is a great credit score and 850 is about as good as it gets.
If your credit is not so hot, there are a bunch of things you can do to get it up like pay off outstanding debts, make sure to pay all of your bills on time and consolidate debt so it's easier to pay off. Keep in mind, though, that just getting rid of credits cards won't necessarily boost your credit and could actually hurt it.
Closing a card doesn't automatically mean your credit score will go down. If you're thinking about shutting down an account, take a good hard look at your credit utilization first. Carefully evaluating your situation and knowing the numbers is the best way to get rid of unwanted credit cards without having your credit score take a plunge.
We have more mortgage tips and credit score information at our website. Just click the Columbia SC Mortgage Info link to your right under the Columbia SC Real Estate Categories.