Avoid These Mortgage Mistakes Once Interest Rates Are Cut

Key Mortgage Mistakes Amid Rate Cuts

With mortgage rates potentially declining, it's essential for homebuyers to be aware of common pitfalls. Here are three major mistakes to avoid:

1. Assuming Mortgage Rates Mirror Fed Cuts

While a drop in the federal funds rate generally leads to lower mortgage rates, it doesn't guarantee a direct correlation. Lenders might have already factored in expected changes, making timing your application crucial.

2. Waiting for Lower Rates

Delaying your mortgage application in hopes of even lower rates can backfire. Increased market activity following rate cuts could drive home prices higher, negating any potential savings from lower rates.

3. Trusting Advertised Rates

Many online lender rates are designed to attract buyers but may not reflect what you will receive. These rates often require ideal credit scores and financial profiles. Always ask lenders about the real rates available to you.

Bottom Line: To maximize benefits from falling rates, prepare strategically and avoid common pitfalls.