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Barclays Cuts Mortgage Rates Below 4% Amid Global Tariff Concerns

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Barclays has cut rates on some of their mortgages below 4% in April 2025! This move comes amidst the ongoing financial uncertainty surrounding US trade tariffs and could signal a potential shift in the mortgage market. I think that it is a very welcome move for the mortgage market.

It’s been a whirlwind watching the economic news lately, especially with the back-and-forth on US trade tariffs. But amidst all the uncertainty, there's a glimmer of good news for prospective homeowners: Barclays, one of the UK's “big six” lenders, has lowered its mortgage rates to below 4% on select deals. As someone who's been following the mortgage market closely, I'm eager to break down what this means for you, and whether it's a sign of things to come.

Barclays Cuts Rates on Some Mortgages to Below 4% Amid US Tariffs Turmoil

Why This Matters

For a long time, the idea of securing a mortgage with an interest rate below 4% seemed like a distant dream. The fact that Barclays, a major player, is now offering these rates is pretty significant for a few key reasons:

  • Increased Affordability: Lower interest rates directly translate to lower monthly mortgage payments. This can make homeownership more accessible to a wider range of people, especially first-time buyers struggling to save for a deposit.
  • Potential Price War: Barclays' move puts pressure on other large lenders like Lloyds, HSBC, and NatWest to follow suit. A competitive price war could drive rates down even further, benefiting borrowers.
  • Boost to the Housing Market: Lower rates can stimulate demand in the housing market, potentially leading to increased sales and a boost to the overall economy.

The Details: What Barclays is Offering

So, what exactly did Barclays change? According to reports, the bank has reduced some of its new mortgage rates by up to 0.38 percentage points. This affects both two-year and five-year fixed-rate deals. Specifically, those deals previously priced at 4.11% and 4.12% (aimed at buyers with larger deposits) have been slashed to 3.99%.

I am always keeping an eye on mortgage offerings. Here is a quick summary table.

Mortgage Type Previous Rate New Rate Difference Notes
Two-Year Fixed Rate 4.11% 3.99% -0.12% Available to buyers with large deposits
Five-Year Fixed Rate 4.12% 3.99% -0.13% Available to buyers with large deposits

US Tariffs and the Bigger Picture

The timing of Barclays' rate cut is definitely interesting. It comes amidst ongoing turmoil surrounding US trade tariffs. It's hard to say with certainty if the rate cut is a direct result of these tariffs, but the market volatility they create undoubtedly plays a role.

The US president’s on-again, off-again approach to tariffs creates a ripple effect across global markets. This uncertainty can influence central banks' decisions about interest rates. If the Bank of England anticipates a slowdown in the UK economy due to trade tensions, they might be more inclined to lower interest rates to stimulate growth.

Expert Opinions: A Mixed Bag

The initial reaction from mortgage experts is cautiously optimistic. Some believe Barclays' move could be the catalyst for a broader mortgage price war. Others suggest that it's too early to tell and that other lenders might wait to see how the market reacts before making similar cuts.

  • Stephen Perkins (Yellow Brick Mortgages): He wonders if the decision was made before or after the US tariff developments.
  • David Stirling (Mint Mortgages & Protection): He is waiting to see if Barclays is just testing the waters.
  • Pete Mugleston (Online Mortgage Advisor): He states there could be a delayed reaction due to market unpredictability.

What This Means for You:

So, should you rush out and apply for a mortgage with Barclays? Here’s my take:

  1. Shop Around: Don't just settle for the first offer you see. Compare rates from different lenders to ensure you're getting the best deal.
  2. Consider Your Circumstances: A lower interest rate is great, but it's not the only factor to consider. Think about your long-term financial goals, your risk tolerance, and the terms and conditions of the mortgage.
  3. Get Professional Advice: Talk to a qualified mortgage advisor. They can help you navigate the complexities of the mortgage market and find the right product for your needs. They can really help you to understand what's happening and make sure that you don't make a bad decision,
  4. Be Prepared: gather all the necessary documentation, such as proof of income, bank statements, and credit reports, to expedite the application process.
  5. Understand Fixed vs. Variable: with fixed-rate mortgages, your interest rate stays the same for the agreed term (e.g., two or five years), providing stability and predictability in your monthly payments. This is beneficial when interest rates are expected to rise, as your payments remain constant. Conversely, with variable-rate mortgages, the interest rate can fluctuate based on the Bank of England's base rate or other market conditions. This can lead to lower payments when interest rates are falling but higher payments if rates increase. It's essential to assess your risk tolerance and financial situation to determine which type suits you best.

Looking Ahead: What to Expect

It's tough to predict the future, but here are a few potential scenarios:

  • Other Lenders Follow Suit: If Barclays' move proves successful, other major lenders could be forced to lower their rates to stay competitive.
  • Rates Remain Stable: Lenders might wait to see how the US trade situation unfolds before making any further adjustments. If tariffs remain in place or escalate, they might be hesitant to lower rates further.
  • Rates Could Rise: If the UK economy proves resilient and the Bank of England doesn't cut interest rates, mortgage rates could actually start to creep back up.

As I have said, no one can say for certain what will happen, but keep an eye on the economic news and I believe you will have a decent idea of what direction the mortgage rates are going.

The Bottom Line

Barclays' decision to cut mortgage rates below 4% is a positive sign for potential homebuyers. It offers the prospect of greater affordability and could trigger a broader price war in the mortgage market. However, it's important to remember that the market is still influenced by global economic factors, so do your homework and seek professional advice before making any big decisions.

I hope this helps you understand the latest developments in the mortgage market and what they mean for you.

Work With Norada, Your Trusted Source for

Turnkey Real Estate Investments in the U.S.

Investing in turnkey real estate can help you secure consistent returns with fluctuating mortgage rates.

Expand your portfolio confidently, even in a shifting interest rate environment.

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Trump Pauses Reciprocal Tariffs on Most Countries for 90 Days

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On April 9, 2025, U.S. President Donald Trump initiated a 90-day pause on tariffs for most countries, offering a temporary respite from escalating trade tensions, while simultaneously ratcheting up tariffs on Chinese imports to a staggering 125%. This sudden shift came after a period of intense global market volatility, leaving many wondering if it was a strategic masterstroke or a reactive retreat.

Trump Pauses Tariffs on Most Countries for 90 Days: A Moment of Relief or a Tactical Maneuver?

The Week the World Held Its Breath

Before the pause, Trump's trade policies, a key part of his “America First” agenda, had been gaining traction. Just a week prior, he implemented a 10% tariff on all imports, along with additional “reciprocal” tariffs on nearly 90 countries based on their trade deficits with the U.S. The aim was to combat what he considered unfair trade practices and the decline of American manufacturing.

The global response was swift and severe, I remember seeing the headlines and the worry etched on people's faces.

  • Stock markets plummeted, wiping out trillions in value.
  • The S&P 500 experienced its worst week since the 2008 financial crisis.
  • Business leaders, including some of Trump's allies, warned of an impending recession.

Billionaire Bill Ackman even described the tariffs as an “economic nuclear war,” a sentiment that resonated with many. Facing this intense pressure, Trump seemingly shifted gears.

In a Truth Social post, he announced the 90-day pause, citing the willingness of over 75 countries to negotiate trade solutions. The universal tariff rate would drop to 10% for these nations, effective immediately. It felt like a collective sigh of relief rippled across the globe.

China: The Exception to the Rule

While most countries received a break, China was singled out for a hefty 125% tariff hike. Trump justified this as a response to Beijing’s “lack of respect” for global markets and its retaliatory tariffs on American goods.

This escalation marks a new high in the U.S.-China trade war, a conflict that has been a recurring theme during Trump's time in office. Treasury Secretary Scott Bessent painted China as the “biggest source” of America’s trade problems. The message was clear: cooperate, and you will be rewarded; retaliate, and face the consequences.

Trump also expressed optimism that Chinese President Xi Jinping would eventually seek a deal, but without specific concessions, I am not sure how this would play out.

A Calculated Move or a Quick Fix?

The White House presented the 90-day pause as a strategic play, designed to bring nations to the negotiating table. Bessent even claimed this was “his strategy all along.”

However, the suddenness of the reversal, just hours after the reciprocal tariffs took effect, suggests a reaction to an immediate crisis. The market turmoil and warnings from economic figures like Jamie Dimon likely played a significant role in Trump's decision.

For Trump, this pause strikes a balance between his tough trade rhetoric and political practicality. The initial tariff rollout raised concerns about voter backlash due to rising prices, something he couldn't afford with midterm elections approaching. By easing the pressure on most nations, he buys time to negotiate while maintaining his tough stance on China, which remains popular with his supporters.

Economic Ripple Effects: Relief and Lingering Concerns

The announcement triggered an immediate surge in global markets. On April 9, the S&P 500 jumped 9.5%, its best single-day gain since 2008, while the Dow Jones Industrial Average soared nearly 3,000 points.

  • Tech companies like Apple and Nvidia saw double-digit gains.
  • Asian and European markets followed suit.

The relief was palpable after a week that had erased $6 trillion in U.S. stock value.

However, the pause isn't a complete reset. The 10% universal tariff remains, along with existing levies on steel, aluminum, and autos. Economists warn that these measures, combined with the China tariffs, still pose significant risks.

According to Goldman Sachs, the U.S. economy is “not out of the woods.” JPMorgan pegged the recession odds at 60%, arguing that the 10% tariff alone represents a “large shock.”

For businesses, the 90-day window presents both opportunity and uncertainty. Companies that had scaled back forecasts due to tariff fears now have a reprieve, but must prepare for potential hikes if negotiations fail. Consumers may see a temporary halt to price increases, but the China tariffs could still drive up costs for goods sourced from there.

Global Perspectives and the Road Ahead

The pause has been met with cautious optimism internationally. Canadian Prime Minister Mark Carney called it a “welcome reprieve,” while the European Union mirrored the move by pausing its retaliatory tariffs for 90 days to allow negotiations. Japan has pressed for a review of existing steel and auto tariffs, signaling that the pause is just the beginning.

The next three months will be crucial in determining whether Trump can turn this leverage into meaningful deals. Bessent hinted at talks on various issues, including liquefied natural gas, non-tariff barriers, and currency policies. For China, the stakes are high: its economy, already strained by the trade war, faces a significant hit from the 125% tariffs, potentially forcing concessions or further escalation.

The Bottom Line: A Risky Move with Uncertain Outcomes

Trump’s decision reflects his penchant for dramatic actions and the limitations of his economic brinkmanship. It's a high-stakes gamble aimed at reshaping global trade dynamics while maintaining his image as a tough negotiator.

While the world breathes a sigh of relief for now, the clock is ticking. By July 2025, the outcomes of these negotiations will determine whether this pause leads to trade stability or merely delays a looming crisis. As Trump put it, “Nothing’s over yet.” Only time will tell if the spirit of cooperation he mentions will translate into concrete results.

In conclusion, while this move offers temporary relief, the long-term implications are far from certain. We need to closely observe the negotiations and their outcomes in the coming months to fully understand the impact of this decision. I will be watching!

Work With Norada – Stay Ahead Regardless of Policy Shifts

With Trump pausing reciprocal tariffs for 90 days, global markets remain uncertain. Now is the time to focus on recession-resilient assets that build long-term wealth.

Norada’s turnkey real estate investments offer predictable returns and passive income regardless of geopolitical developments.

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Today’s Mortgage Rates April 10, 2025: Rates Spike as Tariff Concerns Rise

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As of April 10, 2025, mortgage rates are averaging around 6.80%. This represents a significant increase from last month, driven by instability in the bond market as concerns about tariffs grow. If this trend continues, we may soon see rates surpass the 7% threshold for the first time in nearly a year. This spike in rates impacts both new homebuyers and those considering refinancing their existing loans.

Today's Mortgage Rates – April 10, 2025: Rates Spike as Tariff Concerns Rise

Key Takeaways

  • Current mortgage rates are averaging 6.80%.
  • A worry about tariffs has led to a rise in rates, primarily due to bond market instability.
  • Refinancing rates are similar to purchase rates, averaging around 6.89% for 30-year refinances.
  • It's uncertain if rates will continue to rise or if market conditions will lead to a decrease in the near future.

Understanding Today's Mortgage Rates

Mortgage rates fluctuate due to various factors, including economic indicators, investor behavior in the bond market, and Federal Reserve policies. As we look into the current situation, let's take a closer look at the different types of mortgage loans available today and their rates.

Current Mortgage Rates as of April 10, 2025:

Mortgage Type Average Rate Today
30-Year Fixed 6.85%
20-Year Fixed 6.61%
15-Year Fixed 6.21%
7/1 Arm 7.55%
5/1 Arm 7.31%
30-Year FHA 5.95%
30-Year VA 6.45%

(Source: Zillow)

These rates have climbed from around 6.45% in March, highlighting a considerable shift in the mortgage landscape. The 30-year fixed-rate mortgage continues to be the go-to option for many homebuyers due to its long repayment period and fixed interest rate, which provides predictability in budgeting. Let’s dive deeper into these mortgage options.

Different Types of Mortgages

30-Year Fixed-Rate Mortgage

This is the most common type of mortgage for homebuyers. The 30-year fixed-rate mortgage allows you to spread your payments over three decades while locking in a fixed interest rate. The lower monthly payments make it manageable for most families. However, over time, borrowers pay considerably more in interest compared to shorter-term options. For example, a mortgage of $300,000 at 6.85% interest results in a monthly payment of approximately $1,964. Over the life of the loan, the total interest paid would exceed $400,000.

15-Year Fixed-Rate Mortgage

A growing number of homeowners consider 15-year fixed-rate mortgages because they offer reduced interest rates (currently at 6.21%) and enable homeowners to build equity faster. Monthly payments are higher, but interest savings can be significant. For the same $300,000 loan, the monthly payment would be approximately $2,539, but the total interest paid would be only about $231,000 over the life of the loan. This means homeowners save $170,000 in interest compared to a 30-year mortgage.

Adjustable-Rate Mortgages (ARMs)

For those seeking lower initial payments, Adjustable-Rate Mortgages (like the 7/1 ARM at 7.55%) provide a lower rate for the initial period (in this case, the first 7 years) before adjusting based on market rates. However, this variability means the payments can increase significantly after the initial fixed period, which can lead to payment shock for borrowers.

FHA and VA Loans

Government-backed loans, such as FHA (5.95%) and VA Loans (6.45%), offer attractive options for specific groups, like first-time homebuyers and veterans. FHA loans require lower credit scores and smaller down payments, making them accessible for those with limited financial histories. VA loans provide backed financing with no down payment for eligible service members, making homeownership more feasible.

Current Refinance Rates

Refinance rates have seen similar trends, reflecting the current dynamics of the mortgage market. They allow homeowners to adjust their existing loans to more favorable terms, which can lead to substantial savings in monthly payments and overall interest.

Current Refinance Rates:

Refinance Type Average Rate Today
30-Year Fixed Refinance 6.89%
20-Year Fixed Refinance 6.71%
15-Year Fixed Refinance 6.23%
7/1 Arm Refinance 6.62%
5/1 Arm Refinance 7.40%
30-Year FHA Refinance 5.75%
30-Year VA Refinance 6.37%

(Source: Zillow)

The Economics Behind Rising Rates

The notable increase in mortgage rates stems from ongoing economic circumstances, especially the government's stance on tariffs and the resulting impact on the stock and bond markets. When President Trump announced tariffs, fears about a potential recession led investors to liquidate stocks, redirecting their finances toward traditionally safe assets, like government bonds. Despite this initial shift, the bond market soon appeared unstable as traders expressed concerns about the overall health of the economy amidst tariff implications.

Inflation and Federal Reserve Influence

The Federal Reserve’s monetary policy over the past few years, especially its aggressive stance to combat inflation by increasing interest rates, has caused ripples throughout the economy. Though inflation rates have gradually decreased, they remain above the Fed's 2% target. This ongoing inflation coupled with the uncertain economic climate causes fluctuations in mortgage rates.

The Fed's actions do not directly dictate mortgage rates, but they influence investor sentiment and demand for mortgage-backed securities (MBS). A cooling off in consumer spending could prompt the Fed to reevaluate its strategies, potentially leading to changes in interest rates over time.

Predictions for Future Mortgage Rates

As rates are currently climbing, the future of mortgage rates remains subject to economic and geopolitical factors. Some analysts predict that rates could retreat slightly down the line as inflation stabilizes and economic conditions improve. However, with the current landscape marked by tariff concerns and economic unpredictability, it could be risky for those waiting for rates to drop considerably.

Despite the increases, it’s noteworthy that mortgage rates today are still lower compared to the early 2000s, where rates were frequently above 7% and sometimes reached over 8%.

Reflecting on the past five years, mortgage rates have gone through significant changes due to differing economic pressures:

Year Average Rate (%)
2021 3.11
2022 5.30
2023 6.10
2024 6.45
April 2025 6.80

This trajectory illustrates not only the rise in mortgage rates due to economic recovery following the pandemic but also highlights the volatility resulting from inflation concerns and government policies regarding tariffs.

Expert Opinions and Insights

Based on discussions with financial experts, the prevailing sentiment is cautious optimism. Those in the industry believe that while the specter of tariffs may create short-term volatility, the overall long-term outlook suggests a gradual easing of rates back to more reasonable levels as the Fed balances inflation through its policies. Therefore, homeowners contemplating refinancing are encouraged to closely monitor rates and make strategic decisions based on comprehensive market evaluations.

Personal Insights on the Mortgage Landscape

As a participant in the mortgage sector, I’ve observed firsthand how pivotal the current climate is for buyers. It’s crucial to stay informed about market updates and potential changes, as decisions made today can have long-term impacts on financial well-being. Homeownership isn’t merely about having a roof over one’s head; it’s a significant part of one’s financial portfolio, influencing savings, investments, and lifestyle choices.

Navigating the complexities of mortgage options requires diligence. Understanding the types of loans available is essential for making informed decisions that align with one’s financial objectives. By leveraging tools such as mortgage calculators and discussing options with financial advisors, individuals stand a better chance of securing favorable terms.

Work With Norada, Your Trusted Source for

Real Estate Investment in the U.S.

Investing in turnkey real estate can help you secure consistent returns with fluctuating mortgage rates.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

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Mortgage Rates Drop: Demand Surges 20% Amid Tariff-Driven Turmoil

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If you've been on the fence about buying a home or refinancing your mortgage, recent events might have caught your eye. Last week, we saw a significant jump: Mortgage demand surged by 20%, reaching levels not seen since September 2024. This spike was triggered by a brief dip in mortgage rates, a consequence of volatility in the financial markets spurred by tariff-related news. Let's dive into what happened and what it means for you.

Mortgage Rates Drop: Demand Surges 20% Amid Tariff-Driven Turmoil

A Perfect Storm: Tariffs, Rates, and Refinancing

It all started with shifts in the tariff situation, which caused ripples in the financial markets. These ripples translated into a decrease in mortgage interest rates. The average contract interest rate for 30-year fixed-rate mortgages (with conforming loan balances of $806,500 or less) fell from 6.70% to 6.61%. While this might seem like a small change, it was enough to trigger a significant response from homeowners and potential buyers.

Think of it this way: even a slight dip in interest rates can save you a substantial amount of money over the life of a mortgage. For example, consider a $300,000 mortgage. Dropping your interest rate from 7% to 6.61% can save you almost $25,000 over 30 years. This is why the phones at mortgage lenders suddenly started ringing off the hook.

Key Factors Contributing to the Surge:

  • Rate Drop: The decrease in mortgage rates, albeit brief, made borrowing more attractive.
  • Refinancing Rush: Homeowners who had previously missed out on lower rates jumped at the opportunity to refinance. Applications to refinance a home loan increased 35% from the previous week and were 93% higher than the same week one year ago.
  • Purchase Demand Increase: Applications for a mortgage to purchase a home increased 9% for the week and were 24% higher than the same week one year ago.

Refinance Applications Boom

The most significant reaction was in the refinance market. The 35% jump in refinance applications tells us that many homeowners have been waiting for the right moment to lower their monthly payments. The average refinance loan size also rose to its second highest in the survey at $399,600, indicating that a good portion of this demand came from borrowers with larger loans.

Purchase Demand Shows Strength

It wasn't just refinancing that saw a boost. Applications for mortgages to purchase homes also increased by 9% for the week, reaching their highest level since January 2024. This suggests that despite higher prices, the underlying demand for homeownership remains strong. It's also a sign that some buyers are getting used to the current rate environment and are ready to move forward with their plans.

Adjustable-Rate Mortgages (ARMs) on the Rise

Interestingly, the share of adjustable-rate mortgage (ARM) applications also climbed last week, reaching 8.6% of total applications, up from 5.4% the previous week. This could be because the average contract interest rate for 5/1 ARMs decreased to 5.93% from 6.04%. Crossing into that emotionally significant 5% range might be more appealing to some buyers.

Will the Good Times Last?

The surge in mortgage demand was certainly exciting, but it's important to consider whether it will last. Unfortunately, the initial data suggests this party may be over already.

Rates have already started climbing again. A separate survey from Mortgage News Daily indicated that rates rose sharply at the beginning of this week, effectively wiping out all of last week’s gains and then some. It appears as though that tariff volatility is not to be relied upon to bring down mortgage rates and that rates may be on the rise as we head into the later part of the year.

What This Means for You

So, what should you take away from all of this?

  • If you missed the dip: Don't panic! Mortgage rates are constantly fluctuating. Keep an eye on the market, and be ready to act if another opportunity arises.
  • Don't try to time the market: It's impossible to predict exactly when rates will hit their lowest point. Focus on your financial situation and your long-term goals.
  • Consider your options: Explore different mortgage products, such as fixed-rate mortgages and ARMs, to find the best fit for your needs.
  • Work with a trusted lender: A good mortgage professional can help you navigate the complexities of the market and make informed decisions.

The Importance of Economic Data

The future of mortgage rates will depend on a variety of factors, including inflation, economic growth, and the Federal Reserve's monetary policy decisions. Upcoming inflation data, particularly the Consumer Price Index (CPI) and the Producer Price Index (PPI), will likely play a significant role in shaping rate momentum.

  • CPI (Consumer Price Index): Measures changes in the price of goods and services purchased by households. Higher-than-expected inflation readings can lead to higher interest rates.
  • PPI (Producer Price Index): Measures changes in the price of goods and services sold by producers. Similar to CPI, higher PPI readings can also contribute to rising interest rates.

Navigating the Volatility: My Expert Advice

Having worked in the real estate sector for years, I've learned that patience and a long-term perspective are key when it comes to major financial decisions like buying a home or refinancing a mortgage. While it's tempting to jump on the bandwagon when rates dip, it's crucial to assess your own financial situation and needs first.

Don't let short-term volatility dictate your decisions. Instead, focus on factors like your income, credit score, debt-to-income ratio, and long-term financial goals. By taking a holistic approach, you'll be better positioned to make informed choices that align with your individual circumstances.

The Bottom Line

The recent surge in mortgage demand is a reminder that even small changes in interest rates can have a big impact on the housing market. While the dip in rates may have been fleeting, it highlights the pent-up demand that exists among both homebuyers and homeowners looking to refinance. Moving forward, it's essential to stay informed, work with trusted professionals, and make decisions that are in your best long-term financial interest.

Work With Norada, Your Trusted Source for

Real Estate Investment in the U.S.

Investing in turnkey real estate can help you secure consistent returns with fluctuating mortgage rates.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

Also Read:

Today’s Mortgage Rates April 9, 2025: Rates Rise Back Amid Economic Uncertainty

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As of April 9, 2025, current mortgage rates have climbed to around 6.70%, marking a significant increase from previous weeks. This rise in rates comes as markets react to new tariff announcements and the Federal Reserve's monetary policy stance. Understanding these fluctuations is essential for homebuyers and homeowners considering refinancing.

Today's Mortgage Rates April 9, 2025: Rates Go Up Amid Economic Uncertainty

Key Takeaways:

  • Current mortgage rates: Approximately 6.70% for a 30-year fixed mortgage.
  • Recent volatility: Rates have surged due to tariff-related uncertainties and Federal Reserve positioning.
  • Refinance opportunities: It may not be the best time to refinance for everyone, but those with older, higher-rate mortgages should evaluate their options.
  • Long-term outlook: While rates might ease slightly in the coming months, a return to historic lows isn't expected soon.

Current Mortgage Rates

To provide a detailed overview, here's a snapshot of today's mortgage and refinance rates:

Mortgage Type Average Rate Today
30-Year Fixed 6.72%
20-Year Fixed 6.49%
15-Year Fixed 6.12%
7/1 ARM 6.78%
5/1 ARM 7.27%
30-Year FHA 5.95%
30-Year VA 6.40%

(Data Source: Zillow)

Current Refinancing Rates

Refinance Type Average Rate Today
30-Year Fixed Refinance 6.79%
20-Year Fixed Refinance 6.63%
15-Year Fixed Refinance 6.12%
7/1 ARM Refinance 6.29%
5/1 ARM Refinance 6.70%
30-Year FHA Refinance 5.75%
30-Year VA Refinance 6.26%

(Data Source: Zillow)

The Recent Rate Increase Explained

Mortgage rates have not only increased but have done so with notable volatility in recent days. The primary influence seems to be economic uncertainties surrounding new tariffs. When the White House announced higher tariffs, it contributed to an initial drop in mortgage rates as investors sought safety in bonds. However, as markets adjusted and stock values rebounded, mortgage rates surged again, reaching their highest levels since January.

The Federal Reserve's position is also playing a crucial role. Chair Jerome Powell indicated that the Fed will adopt a cautious approach, waiting to fully assess the impact of tariffs before making any further policy changes. This stance suggests that there may be a delay in rate cuts, contributing to the upward pressure on mortgage rates.

The interplay between tariffs and mortgage rates presents a complex scenario for borrowers. Typically, tariffs can lead to increased costs on imported goods, which, in turn, can drive inflation higher. As inflation rises, the Federal Reserve may be compelled to keep interest rates elevated, impacting mortgage rates indirectly. Interest rate policies are typically designed to stabilize inflation and encourage economic growth, and recent tariff announcements have introduced new layers of uncertainty.

How Do Mortgage Rates Work?

Understanding mortgage rates can seem complicated, but at its core, a mortgage rate influences how much you'll pay each month to borrow money for your home. Here's a simple breakdown of how it works:

When you take out a mortgage, you agree to pay back the amount borrowed (the principal) along with interest over a set period, typically 15 or 30 years. Your monthly payment consists of both principal and interest, with the initial payments going primarily toward interest.

Let’s use an example to illustrate. If you secure a mortgage of $300,000 at 6.5% interest, your estimated monthly payment might be about $1,896. Initially, a larger portion of this will go to interest, but over time, you'll pay down the principal faster as the loan amortizes.

Here’s how the total interest paid changes over time in this scenario:

  • Year 1: Approximately $1,625 of your first payment goes to interest, and $271 reduces your loan balance.
  • Year 10: By this point, your interest costs would drop to about $1,450 per month while $546 would apply toward the principal.
  • Year 20: As the loan matures, you could be paying about $905 in interest and having greater amounts applied to the principal.

To visualize how long your payments will take to reduce what you owe, you can request an amortization schedule or use a mortgage calculator to simulate payments at different rates.

How Often Do Mortgage Rates Change?

Mortgage rates are not static; they fluctuate daily based on numerous factors, including economic conditions and investor sentiment. Rate changes can occur due to:

  • Economic Indicators: Data such as employment rates, consumer spending, and inflation can influence investor behavior and rate adjustments.
  • Federal Reserve Actions: The Fed's monetary policy significantly influences market sentiment and, consequently, mortgage rates. When the Fed changes its policy stance, mortgage rates often follow suit due to anticipated investor reactions.
  • Market Dynamics: Supply and demand for mortgage-backed securities and treasuries can also lead to rate fluctuations.

In today’s economy, where economic data releases happen regularly, investors closely monitor these reports as they attempt to predict future movements of mortgage rates. For instance, a better-than-expected jobs report could lead to a surge in mortgage rates as investors anticipate stronger economic growth, while a weak report might lead to lower rates as concerns about the economy grow.

What Influences Mortgage Rates?

Various factors contribute to the determination of mortgage rates:

  1. Economic Indicators: Inflation, unemployment rates, and consumer confidence are critical elements that drive changes in rates. For example, higher inflation typically results in higher mortgage rates, as lenders adjust to meet their margins against rising costs.
  2. Federal Reserve Policy: The Fed's monetary policy significantly influences market sentiment and, consequently, mortgage rates. The Fed's announcements and decisions about interest rates can create ripple effects throughout the financial markets, impacting how lenders set their mortgage rates.
  3. Investor Behavior: High demand for mortgage-backed securities can lead to lower rates, whereas decreased demand may drive rates higher. When investors see mortgage-backed securities as less attractive due to perceived risks, they demand higher yields, which translates into higher mortgage rates.
  4. Your Financial Profile: In addition to larger economic factors, individual circumstances such as credit scores, the amount of down payment, and the loan type can also affect your specific mortgage rate. The better your credit score, the more favorable the interest rate you’re likely to receive, as a higher score reflects a lower risk to lenders.

Observing trends gives potential buyers insight into how rates may behave in the future. Over the past several years, mortgage rates have experienced significant fluctuations. After reaching historic lows during the pandemic, rates began to climb as the economy recovered and inflation concerns took center stage.

  • Historical Context: From 2020 through mid-2021, mortgage rates dipped below 3%, providing an unprecedented opportunity for many buyers and homeowners to secure lower monthly payments. However, as recovery gained pace, rates began to rise steadily through 2022 and 2023.
  • Current Expectations: While some predict a gradual easing of mortgage rates throughout 2025, it remains unlikely that we will see returns to the lows of the past. Instead, the expectation is that rates could stabilize around 6% to 6.5% if inflation trends downward.

Should I Refinance Now or Wait?

With today's rates hovering around 6.70%, many homeowners are contemplating whether now is the right time to refinance. The decision hinges largely on personal circumstances, especially the interest rate on your current mortgage.

For those locked into higher interest rates, refinancing could save money. However, with rates currently on the rise, it’s essential to weigh the costs of refinancing against potential savings. Here’s a more detailed look at refinancing considerations:

  1. Cost-Benefit Analysis: Before proceeding with refinancing, it’s vital to analyze your current financial situation. Calculate the potential savings on monthly payments versus the upfront costs associated with refinancing, which often includes closing costs that can range from 2% to 5% of the loan amount.
  2. Long-Term Savings: If refinancing can secure a lower rate, the monthly savings can accumulate significantly over years. For example, refinancing a $400,000 mortgage at a lower rate from 7% to 6% could save homeowners over $300 a month. However, homeowners should consider how long they plan to stay in their home, as benefits must outweigh costs within that time frame.
  3. Future Rate Predictions: While some might hope to hold out for lower rates in the future, predicting the optimal refinancing moment can be difficult. Economic indicators suggest that rates could remain high or increase further, making current opportunities valuable.

The Bigger Picture

The environment for mortgage rates today reflects a complex interplay of factors including fiscal policy, global economic impacts, and local housing markets. With rising rates impacting affordability, potential buyers might find homes becoming less accessible, which could strain the housing market and slow down sales.

We are witnessing a phase where prospective buyers and homeowners must remain adaptable and informed. For potential homebuyers, it may be beneficial to explore fixed-rate options to secure predictable payments. Meanwhile, current homeowners might find opportunities through local programs or specialized loans aimed at reducing monthly expenditures.

In understanding today's mortgage rates and their influences, individuals can navigate the housing market with greater confidence, ensuring they make informed choices for their financial futures.

Work With Norada, Your Trusted Source for

Real Estate Investment in the U.S.

Investing in turnkey real estate can help you secure consistent returns with fluctuating mortgage rates.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

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Mortgage Rates Are Dropping Rapidly Day by Day Due to Tariffs

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It might sound counterintuitive, but right now, tariffs are pushing mortgage rates down almost every day, and as someone keeping a close watch on the housing market, I can tell you it's creating a fascinating, albeit slightly unpredictable, situation for anyone dreaming of owning a home. This isn't just a minor dip; we're seeing a consistent downward trend fueled by the ripples of international trade policies.

So, yes, in the current economic climate, the answer is a definite yes: tariffs are indeed contributing to lower mortgage rates. But like any good story, there's more to this than meets the eye, and understanding the nuances is key for making informed decisions.

Mortgage Rates Are Dropping Rapidly Day by Day Due to Tariffs

To understand why tariffs are having this effect, we need to break down what tariffs are and how they can influence the complex world of mortgage rates.

What Exactly Are Tariffs?

Think of tariffs as a kind of tax ticket on goods coming into a country. When a government puts a tariff on, say, imported steel or electronics, it makes those foreign goods more expensive for domestic buyers. The idea behind this is often to help local industries compete by making their products relatively cheaper.

However, these taxes can also stir things up in the broader economy. Businesses that rely on imported materials might see their costs go up, potentially leading to higher prices for consumers down the line – what we call inflation. This uncertainty is what really gets the financial markets moving.

The Unexpected Link to Mortgage Rates

So, how does a tax on imported goods lead to lower mortgage rates? It's all about how investors react to uncertainty. When tariffs are announced or changed, they can create worries about economic growth. Businesses might hesitate to invest, and consumers might pull back on spending if they're concerned about rising prices.

In times of economic uncertainty, investors tend to look for safer places to put their money. One of these safe havens is often government bonds. When more people want to buy bonds, the demand for them goes up, which can push their yields (the return you get on a bond) down.

Now, here's the crucial part: mortgage rates, especially fixed-rate mortgages that are so popular, tend to follow the trend of these long-term government bond yields. So, when bond yields fall due to increased demand driven by tariff-related economic jitters, mortgage rates often follow suit. It's like a see-saw – uncertainty pushes investors towards bonds, bond yields go down, and mortgage rates tag along for the ride.

Riding the Wave: The Immediate Benefits for Homebuyers

Th recent tariff actions have had a tangible effect on borrowing costs for aspiring homeowners. Within a mere two days following the tariff announcement, the average 30-year fixed-rate mortgage experienced a substantial decline. On April 3rd, rates plummeted by 12 basis points to 6.63%, marking the lowest point seen since October of the previous year.

Freddie Mac's weekly report corroborated this trend, indicating a slight decrease to 6.64%. This downward trajectory continued into April 4th, with rates falling further to 6.55%, a significant 20-basis-point drop from the pre-tariff announcement level. This marked the lowest mortgage rates had been in six months.

This unexpected dip in rates has had a tangible impact on buyer affordability. For an individual operating with a $3,000 monthly housing budget, the decrease from 6.82% (just a week prior) to 6.55% translated to an impressive $9,000 increase in purchasing power. When viewed against the peak mortgage rates of 7.26% in mid-January 2025, the same buyer experienced a substantial $25,000 gain in their potential buying capacity. This offers a glimmer of hope in a market where housing affordability has been persistently challenged by high home prices and elevated interest rates.

However, analysts caution that this reprieve might be short-lived. The fundamental concern remains that the imposed tariffs could ultimately lead to increased inflation as the cost of imported goods rises. Should inflation take hold, the Federal Reserve would likely respond by tightening monetary policy, which could subsequently push mortgage rates back up.

The interplay between tariff policies, inflation, and the Federal Reserve's actions will be crucial in determining the future trajectory of mortgage rates. While the immediate impact of the tariff announcement has been a welcome decrease in borrowing costs, the long-term stability of these lower rates remains uncertain.

A Look at the Numbers:

  • April 3, 2025: Average 30-year fixed-rate mortgage dropped to 6.63% (-12 basis points from April 2).
  • April 4, 2025: Rates fell further to 6.55% (-20 basis points from April 2), a six-month low.
  • Purchasing Power Gain: A $3,000 monthly budget gained $9,000 in purchasing power between March 27th and April 4th.
  • Peak Rate Comparison: Compared to the mid-January 2025 peak (7.26%), the same buyer gained $25,000 in purchasing power.
  • Monthly Payment: Despite lower rates, average monthly mortgage payments remained high at approximately $2,802.
  • April 7, 2025: As of April 7, 2025, mortgage rates have decreased significantly. According to Zillow, the average 30-year fixed mortgage rate now stands at 6.39%, down by 20 basis points since last week. The 15-year fixed mortgage rate has also fallen, dropping 19 basis points to 5.72%.
  • Driving Factor: Investor shift towards safe-haven Treasury bonds due to economic uncertainty from tariffs.
  • Future Risk: Potential for rising inflation due to tariffs could lead to higher mortgage rates in the future.

Why the Rush to Bonds?

It boils down to a flight to safety. When tariffs create concerns about the future health of the economy, investors get nervous about riskier assets like stocks. They see government bonds as a more stable bet during turbulent times. This increased demand for bonds drives their prices up and their yields down, directly impacting how much it costs to borrow money for a mortgage.

Peering into the Future: The Potential Reversal

While the current dip in mortgage rates is welcome news for homebuyers, I can't shake the feeling that this might be a temporary situation. Tariffs, while intended to protect domestic industries, can also have unintended consequences that could eventually lead to higher mortgage rates.

The Specter of Inflation

One of the biggest concerns with tariffs is the potential for inflation. If the cost of imported goods goes up due to these taxes, businesses might pass those costs on to consumers in the form of higher prices for everyday goods. If inflation starts to heat up significantly, the Federal Reserve (the Fed) might step in to try and cool things down by raising interest rates. And when the Fed raises interest rates, mortgage rates typically follow.

Echoes from the Past

I remember the U.S.-China trade war from a few years back (2018-2019). We saw a similar initial reaction where uncertainty led to lower mortgage rates. However, as concerns about inflation grew, those rates eventually started to climb again. History doesn't always repeat itself exactly, but it often provides valuable lessons about potential pathways.

A Delicate Balancing Act

From my perspective, the current situation feels like a bit of a balancing act. We're enjoying the short-term benefit of lower borrowing costs, but the underlying economic forces at play due to tariffs could eventually lead to higher prices and, consequently, higher mortgage rates. It's a situation that requires careful monitoring.

What This Means for You: Navigating the Current Market

As someone deeply involved in observing market trends, my advice to potential homebuyers right now is to be both opportunistic and cautious.

Seizing the Moment, Mindful of the Risks

The lower mortgage rates we're seeing represent a real opportunity to reduce your monthly housing costs. If you're in a stable financial situation and have been considering buying a home, now might be a good time to explore your options and potentially lock in a favorable interest rate.

However, it's crucial to go into this with your eyes wide open. While lower rates can help with affordability, home prices in many areas remain high. With the median price of new homes around $460,000 in 2025 and the sobering statistic that approximately 70% of U.S. households may struggle to afford a $400,000 home, the fundamental challenge of affordability hasn't vanished.

My Advice for Homebuyers

Here's what I would recommend based on my understanding of the market:

  • Don't Wait Too Long to Explore Rates: If you're serious about buying, start shopping around for mortgage rates now. If you find a rate that looks good, consider locking it in. This can protect you from potential rate increases down the line.
  • Be Realistic About Your Budget: Just because rates are lower doesn't mean you should stretch your budget to the absolute limit. Consider all the costs associated with homeownership, not just the monthly mortgage payment.
  • Stay Informed About Economic News: Keep an eye on inflation reports, Federal Reserve announcements, and any further developments regarding tariffs. These can provide clues about where mortgage rates might be headed.
  • Talk to the Experts: Don't go it alone. Consult with experienced real estate agents and mortgage lenders. They can provide personalized advice based on your specific situation and the current market conditions.

Final Thoughts: An Opportunity Wrapped in Uncertainty

Ultimately, the fact that tariffs are pushing mortgage rates down almost every day presents a window of opportunity for many aspiring homeowners. It's a chance to potentially secure lower borrowing costs and make the dream of homeownership more accessible. However, this situation is intertwined with the complexities and uncertainties of international trade and its broader economic impacts. As we navigate this interesting period, staying informed, being realistic, and seeking expert advice will be crucial for making sound financial decisions. This moment calls for both enthusiasm and a healthy dose of caution as we watch how these economic forces continue to unfold.

Work With Norada, Your Trusted Source for

Real Estate Investment in the U.S.

Investing in turnkey real estate can help you secure consistent returns with fluctuating mortgage rates.

Expand your portfolio confidently, even in a shifting interest rate environment.

Speak with our expert investment counselors (No Obligation):

(800) 611-3060

Get Started Now

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What Happens to Homeowners if the Housing Market Crashes?

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How Does a Market Crash Affect Homeowners?

If home values fall quickly, purchasers may find themselves with underwater mortgages, which means they must either stay in the house until the market recovers or sell and lose money. Homeowners owe more on their mortgages than their homes were worth and can no longer just flip their way out of their homes if they cannot make the new, higher payments. Instead, they will lose their homes to foreclosure and often file for bankruptcy in the process. The housing crash begins to take its toll on homeowners and the real estate market.

The housing market has encountered significant obstacles over the previous century, but none, with the exception of the Great Depression of 1929, contributed to the decline in home prices that occurred during the Great Recession of 2007. Neither the 20 percent interest rates of the early 1980s nor the devastation of the savings and loan sector in the early 1990s led to a similar drop in property values.

<<<Also Read: Will the Housing Market Crash? >>>

It is also worth remembering that not all economic downturns chill the property market. In reality, throughout the 2001 recession, the housing market and house demand remained strong despite the economic slump. Throughout the course of the last century, the housing market has been subjected to a number of significant obstacles; but, with the exception of 1929's Great Depression, none of these problems have resulted in a decline in home values on par with that of 2007's Great Recession.

The interest rates of 20 percent in the early 1980s and the devastation of the savings and loan business in the early 1990s did not lead to a similar drop in the value of homes. It is also important to note that the housing market is not always affected negatively by recessions. Despite the fact that the economy was in a slump during the recession that began in 2001, the housing market and demand for homes continued to be healthy.

The previous housing bubble in the United States in the mid-2000s was caused in part by another bubble, this time in the technology industry. It was intimately tied to, and some believe was the cause of, the 2007-2008 financial crisis. During the late 1990s dot-com bubble, many new technology companies' stock was purchased quickly. Speculators bought up the market capitalizations of even firms that had yet to create earnings. By 2000, the Nasdaq peaked, and when the tech bubble burst, many high-flying equities plummeted.

After the dot-com bubble bust and stock market crisis, speculators fled to real estate. In response to the technology bust, the U.S. Federal Reserve lowered and maintained interest rates. This rush of money and credit met with government programs to encourage homeownership and financial market developments that improved real estate asset liquidity. More people bought and sold homes as home prices soared.

What Happened to Homeowners When The Housing Market Crashed?

In the next six years, the homeownership craze developed as interest rates fell and lending standards were relaxed. An increase in subprime borrowing began in 1999. Fannie Mae made a determined attempt to make home loans more accessible to borrowers with weaker credit scores and funds than are generally needed by lenders. The intention was to assist everyone in achieving the American dream of homeownership.

Since these customers were deemed high-risk, their mortgages had unconventional terms, such as higher interest rates and variable payments. In 2005 and 2006, 20% of mortgages went to persons who didn't meet regular lending conditions. They were called Subprime borrowers. Subprime lending has a higher risk, given the lower credit rating of borrowers.

75% of subprime loans were adjustable-rate mortgages with low initial rates and a scheduled reset after two to three years. Government promotion of homeownership prompted banks to slash rates and credit criteria, sparking a house-buying frenzy that drove the median home price up 55% from 2000 to 2007. The US homeownership rate had increased to an all-time high of 69.2% in 2004.

During that same period, the stock market began to rebound, and by 2006 interest rates started to tick upward. Due to rising property prices, investors stopped buying homes because the risk premium was too great. Subprime lending was a major contributor to this increase in homeownership rates and in the overall demand for housing, which drove prices higher.

Borrowers who would not be able to make the higher payments once the initial grace period ended, were planning to refinance their mortgages after a year or two of appreciation. As a result of the depreciating housing prices, borrowers’ ability to refinance became more difficult. Borrowers who found themselves unable to escape higher monthly payments by refinancing began to default.

There was an increase in the number of foreclosures and properties available for sale as more borrowers defaulted on their mortgages. A drop in housing prices resulted, in lowering the equity of homeowners even more. Because of the fall in mortgage payments, the value of mortgage-backed securities dropped, which hurt banks' overall value and health. The problem was rooted in this self-perpetuating cycle.

By September 2008, average US property prices had fallen by more than 20% since their peak in mid-2006. Because of the significant and unexpected drop in house values, many borrowers now have zero or negative equity in their houses, which means their properties are worth less than their mortgages. As of March 2008, an estimated 8.8 million borrowers – 10.8 percent of all homeowners – were underwater on their mortgages, a figure that is expected to have climbed to 12 million by November 2008.

By September 2010, 23 percent of all homes in the United States were worth less than the mortgage loan. Borrowers in this circumstance have the incentive to default on their mortgages because a mortgage is normally non-recourse debt backed by real estate. As foreclosure rates rise, so does the inventory of available homes for sale.

In 2007, the number of new residences sold was 26.4 percent lower than the previous year. The inventory of unsold new houses in January 2008 was 9.8 times the sales volume in December 2007, the highest value of this ratio since 1981. Furthermore, about four million existing residences were for sale, with around 2.2 million of them being unoccupied.

The inability of Homeowners To Make Their Mortgage Payments

The inability of homeowners to make their mortgage payments was primarily due to adjustable-rate mortgage resetting, borrowers overextending, predatory lending, and speculation. Once property prices began to collapse in 2006, record amounts of household debt accumulated over the decades. Consumers started paying off debt, which decreases their spending and slows the economy for a prolonged period of time until debt levels decreased.

Housing speculation using high levels of mortgage debt drove many investors with prime-quality mortgages to default and enter foreclosure on investment properties when housing prices fell.  As prices fell, more homeowners faced default or foreclosure. House prices are projected to fall further until the inventory of unsold properties (an example of excess supply) returns to normal levels. According to a January 2011 estimate, property prices in the United States fell by 26 percent from their high in June 2006 to November 2010, more than the 25.9 percent decrease experienced during the Great Depression from 1928 to 1933.

There were roughly 4 million finalized foreclosures in the United States between September 2008 and September 2012. In September 2012, over 1.4 million properties, or 3.3 percent of all mortgaged homes, were in some stage of foreclosure, up from 1.5 million, or 3.5 percent, in September 2011. In September 2012, 57,000 houses went into foreclosure, down from 83,000 the previous September but still far over the 2000-2006 monthly average of 21,000 completed foreclosures.

A variety of voluntary private and government-administered or supported programs were implemented during 2007–2009 to assist homeowners with case-by-case mortgage assistance, to mitigate the foreclosure crisis engulfing the U.S. During late 2008, major banks and both Fannie Mae and Freddie Mac established moratoriums (delays) on foreclosures, to give homeowners time to work towards refinancing In 2009, over $75 billion of the package was specifically allocated to programs that help struggling homeowners. This program is referred to as the Homeowner Affordability and Stability Plan.

Is There a Housing Bubble?

When a new generation of homebuyers enters the market, housing bubbles often arise naturally as a result of population expansion. As a result of this expansion, the demand for housing is expected to rise. Speculators, excellent economic circumstances, low-interest rates, and a wide variety of financing alternatives are all elements that will lead to an increase in home values. Increased demand drives up costs because of the building time lag. Any time housing prices diverge significantly from demographically-based organic demand, the broader economy is at risk of entering a state of crisis.

The COVID-19 pandemic did not slow home prices at all. Instead, it skyrocketed. In September 2020, they were a record $226,800, according to the Case-Shiller Home Price Index. According to the National Association of Realtors, the sales rate hit 5.86 million houses in July 2020, rising to 6.86 million by October 2020, surpassing the pre-pandemic record. Many people were taking advantage of the low-interest rates to purchase either residential properties or income-based flats that appeared to be inexpensive.

Home prices rose 18.8% in 2021, according to the S&P CoreLogic Case-Shiller US National Home Price Index, the biggest increase in 34 years of data and substantially ahead of the 2020s 10.4% gain. The median home sales price was $346,900 in 2021, up 16.9% from 2020, and the highest on record going back to 1999, according to the National Association of Realtors. Home sales had the strongest year since 2006, with 6.12 million homes sold, up 8.5% from the year before.

As speculators entered the market, home prices skyrocketed, exacerbating the housing market bubble. Now it reaches a time when home prices are no longer affordable to buyers. Rising prices make properties unsustainable, causing them to be overpriced. In other words, pricing increases. Low inventory, fierce competition, and large price increases have harmed purchasers since 2020, but quickly rising mortgage rates are making it much more difficult to find an affordable house.

As prices become unsustainable and interest rates rise, purchasers withdraw. Borrowers are discouraged from taking out loans when interest rates rise. On the other side, house construction will be affected as well; costs will rise, and the market supply of housing will shrink as a result. In contrast to a sudden jump, a sustained rise in interest rates will inflict little damage on the housing market.

Rising rent costs and mortgage rates, which increased from an average of just 3.2% at the beginning of the year to 5.81 percent by mid-June, have increased the cost of housing, pricing many individuals out of the market. This has resulted in a decline in house sales since an increasing number of individuals are unable to buy homes at the present inflated prices. According to NAR, existing-home sales declined for the fourth consecutive month in May, falling 3.4% from April and 8.6% from the same period last year.

Given the relative scarcity of available homes, the majority of analysts concur that a decline in housing prices is improbable. In addition to rising mortgage rates and subsequently less demand, a downturn might exert downward pressure on home prices. Despite many similarities to the housing bubble of 2008, the present housing market is quite different from it.

Homeowners with mortgages are not at a high risk of default, housing values are mostly determined by supply and demand rather than speculation, and lending rates continue to rise. Accordingly, the concept of a housing market crash is deemed improbable by a number of industry professionals. Many analysts believe that sky-high mortgage rates and the associated drop in housing demand will moderate the increase of home prices rather than result in any significant reversal in prices or a crash, which is generally defined as a widespread drop in home prices.

However, in the event that a more widespread recession hits the economy of the United States, the conditions might be created for a little decline in housing values. A deeper and more widespread economic downturn is likely to prompt a greater number of homeowners to sell their homes than would be the case otherwise. Because of the rise in available inventory, housing prices could experience some leveling out as a result.

It is also possible that a recession may just serve to limit the increase of property values, which is what many people anticipate would happen if interest rates continue to climb. However, it is still challenging to bring prices down because there are only limited properties available for purchase. The number of people applying for mortgages has already dropped by more than 50 percent since this time last year. It is not unrealistic to foresee a further decline in home demand given the impending implementation of additional rate increases. This will serve to rebalance the housing market, which is now squeezed, but it won't necessarily bring it to the point where it crashes.

If The Housing Market Crashes What Happens To Interest Rates?

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There is a lot of speculation in the media that the slowing housing market is an indication that the market is headed for a housing crash. People who recall the subprime mortgage crisis are concerned that the recent spike in home prices followed by a pause signals the bursting of another housing bubble. But is the housing market truly in a bubble?

During a housing market crash, the value of a home decreases. You will find sellers that are eager to reduce their asking prices. Sellers may be more motivated to bargain on price or make concessions to buyers. Due to the crash, there may also be short sales and foreclosures, offering you the opportunity to acquire a deal. Many homebuyers may feel that obtaining a mortgage is too risky.

Recessions are temporary pauses in an otherwise booming economy, but they have an impact on the housing market and interest rates. This break, however, may be an excellent moment to purchase or refinance a property. Discuss with your lender how recessions affect interest rates, how you might reduce your mortgage rate, and how to mitigate your homebuying risk. Now, it's more likely that home prices will not crash, and will continue to rise, although at a slower pace.

There is a lower likelihood that a borrower would default on a mortgage. New laws and lessons learned from the 2008 financial crisis have resulted in tougher lending criteria in today's housing market compared to the previous one. Mortgage approval rates today are lower than they were in the pre-crisis era, which suggests that borrowers are less likely to default on their loans. Before the previous housing crash, it was popular for lenders to issue so-called “no-doc loans,” which did not require borrowers to submit proof of their income.

A minimum credit score and a minimum down payment are often required for government-backed loans. According to regulations, lenders must now check a borrower's capacity to repay the loan, among other conditions. Lending standards have tightened and new mortgage credit scores are substantially higher on average now than they were in the early 2000s.

It is also important to keep in mind that a recession will not have a significant impact on home prices if the supply and demand for housing fall at about the same time. Interest rates are one factor that may make a difference. Reduced mortgage rates and consequently lower house costs can bring properties that were previously out of reach within reach. You stand a better chance of your application being approved if you've got good credit.

What Happens to Interest Rates if the Housing Market Crashes?

In a recession, people do not spend, money does not move freely across the economy. They decide against spending and instead save for a better price the next day. Or they save money and do not spend it because they believe they should have precautionary savings. This is true for any industry, including real estate or the housing market.

The Federal Reserve may alter interest rates soon in an effort to minimize economic damage. Occasionally, this helps stabilize markets and boost consumer confidence, resulting in increased expenditure. The adjusted interest rate is used by lenders to determine their interest rates for loans and mortgages in any way possible.

Loans aren't in high demand during a recession since individuals are reluctant to spend money and want to preserve it. Mortgages come in a variety of forms, and each has its advantages and disadvantages, regardless of the economic climate. It's up to you to decide how much risk you're willing to take, but your lender may provide guidance.

The Great Recession left an everlasting imprint on future housing markets. During that period of economic downturn, a greater number of homeowners had mortgages that were upside-down, which means that they owed more on their property than it was worth. As a result of the turmoil that was caused by unemployment and the high levels of consumer debt, lenders were obliged to evaluate in a more strict manner.

The graph below depicts the average 30-year fixed-rate mortgage based on Freddie Mac data obtained from FRED at the Federal Reserve Bank of St. Louis. The shaded areas represent U.S. recessions. The most recent recession, which ran from February to April of 2020, was the COVID-19 pandemic.

Freddie Mac's weekly survey indicates that during this brief period, the 30-year fixed mortgage rate declined from 3.45 percent to 3.23 percent. Thereafter, rates continued to decline, reaching record lows in January 2021. Throughout the Great Recession, which lasted from December 2007 to June 2009, 30-year fixed mortgage rates fluctuated between 6.10 and 5.42 percent.

Mortgage Rates During Past Recessions

The Great Recession was sparked by the mortgage crisis, which led the global financial system to collapse. From March 2001 to November 2001, during the early 2000s recession, mortgage rates decreased from 6.95 percent to 6.66 percent. From July 1990 to March 1991, during the recession of the early 1990s, mortgage rates declined from around 10 percent to 9.5 percent.

In the early 1990s recession, which was from July 1981 to November 1982, interest rates fell from 16.83 percent to 13.82 percent. From January 1980 to July 1980, rates decreased rather slowly, from 12.88 percent to 12.19 percent. In every instance, mortgage rates decreased during a recession. Obviously, the reduction varied from as little as 0.22 percent to as much as around 3 percent.

The lone exception was the 1973-1975 recession, which was caused by the 1973 oil crisis and saw rates rise from 8.58 to 8.89 percent. That was a time of so-called stagflation, which, according to some analysts, is reoccurring but remains to be seen. Homeowners, potential house purchasers, and the mortgage sector will all be hoping for the latter, a large fall in mortgage rates.

Many economists equate the 1980s to the present day, so it's feasible that we'll finally see significant respite. How much farther will mortgage rates rise before a recession, if one occurs at all, is the question. Will the 30-year fixed rate continue to rise to 7 or 8 percent by the end of 2022 or the beginning of 2023, then decrease to 6 percent?

If this is the case, any fall associated with a recession would simply return rates to their current elevated level. In other words, brace for the worst while the Fed does its utmost to combat inflation and hope for a swift recovery. In either case, you may wish to bid farewell to mortgage rates between 3 and 4 percent, at least for the foreseeable future.

What Happens to My Mortgage if the Housing Market Crashes?

The 2008 housing crash imposed an enormous financial burden on US households. As house prices fell by 30 percent nationwide, roughly 1 in 4 homeowners was pushed underwater, eventually leading to 7 million foreclosures. After a housing bubble burst, property values in the United States plunged, precipitating a mortgage crisis. Between 2007 and 2010, the United States subprime mortgage crisis was a transnational financial crisis that led to the 2007–2008 global financial crisis.

It was precipitated by a sharp decrease in US house values following the bursting of a housing bubble, which resulted in mortgage delinquencies, foreclosures, and the depreciation of housing-related assets.  The Great Recession was preceded by declines in home investment, which were followed by declines in consumer expenditure and subsequently business investment. In regions with a mix of high family debt and higher property price decreases, spending cuts were more pronounced.

The housing bubble that preceded the crisis was financed with mortgage-backed securities (MBSes) and collateralized debt obligations (CDOs), which initially provided higher interest rates (i.e., greater returns) than government securities as well as favorable risk ratings from rating agencies. Several large financial institutions collapsed in September 2008, resulting in a huge interruption in the supply of credit to businesses and individuals, as well as the commencement of a severe worldwide recession.

When property values in the United States fell precipitously after peaking in mid-2006, it became more difficult for borrowers to restructure their loans. Mortgage delinquencies skyrocketed as adjustable-rate mortgages began to reset at higher interest rates (resulting in higher monthly payments). Securities backed by mortgages, notably subprime mortgages, were extensively owned by financial firms throughout the world and lost the majority of their value.

Global investors also curtailed their purchases of mortgage-backed debt and other assets as the private financial system's ability and willingness to support lending declined. Concerns over the health of US credit and financial markets led to credit tightening globally and a slowing of economic development in the US and Europe.

Here's Why This Housing Slowdown Is Unlike Any Other

There aren’t as many risky loans or mortgage delinquencies, although high home prices are forcing many people out of the market. But if the Great Recession was triggered by a 2007-08 housing market crash, is today's market in a similar predicament? No, that's the simplest response. Today, the housing market in the United States is in much better shape. This is in part due to the stricter lending laws that were implemented as a result of the financial crisis. With these new guidelines, today's borrowers are in a far better position.

The average borrower's FICO credit score is a record high 751 for the 53.5 million first-lien home mortgages in the United States today. In 2010, it was 699, two years after the collapse of the banking industry. Considerably this is reflected in the credit quality as lenders have become much more rigorous about lending. As a result of pandemic-fueled demand, home prices have risen over the previous two years. Now homeowners have historic levels of equity in their homes.

According to Black Knight, a provider of mortgage technology and analytics, the so-called tappable equity, which is the amount of cash a borrower may withdraw from their house while still leaving 20% equity on paper, set a new high of $11 trillion this year. That's a 34% rise over the same period last year. Leverage, or the ratio of a homeowner's debt to the value of his or her house, has declined precipitously at the same time.

This is the lowest level of mortgage debt in US history, at less than 43 percent of home prices. When a borrower has more debt than the value of their house, they have negative equity. When compared to 2011, when over one-fourth of all borrowers were underwater, this is an improvement. Only 2.5% of borrowers have equity in their houses less than 10%. If property values do decline, this will give a significant amount of protection.

Just 3 percent of mortgages are past due, which is a record low for mortgage delinquencies. There are still fewer past-due mortgages now than before the epidemic, despite the dramatic rise in delinquencies during the first year. There are still 645,000 borrowers in mortgage forbearance programs connected to the pandemic that has helped millions of people recover.

Even though the pandemic-related forbearance programs have been exhausted by some 300,000 debtors, they are still overdue. Even though mortgage delinquencies are still at historically low levels, recent loan originations have seen a rise in the number of defaults.

The most pressing issue in the housing market right now is home affordability, which is at an all-time low in most regions. While inventory is increasing, it is still less than half of what it was before the pandemic. Rising inventory may ultimately chill house price rise, but the double-digit rate has shown to be extremely resilient thus far. As rising home costs begin to strain some buyers' finances, those who remain in the market should expect less competitive circumstances later in the year.

Home Values May Decline Regardless of a Recession

The housing market is based on a supply and demand cycle. A buyer's market exists when there is a big inventory of properties for sale, and property prices tend to decline. When inventory is low, however, residences are in high demand and the market shifts to a seller's market. It takes time to develop new dwellings and replenish supplies.

Housing prices will begin to fall if inventory grows and demand is fulfilled. Another reason that property prices have lately slowed is that individuals can no longer afford them. Income levels have not kept pace with house costs, and many first-time buyers who are still saddled with college loans cannot afford the extra weight of a mortgage.

The current housing inflation storm is driving buyers out of the market, contributing to the protracted period of extremely limited inventory—but sellers are still hesitant to lower prices. Waiting may be the best option for purchasers with time, regardless of whether there is a recession. According to Realtor.com, the number of houses for sale increased by the most in June 2022 on record. Active listings increased 18.7 percent year on year, but property prices remain persistently high.

In June, the national median listing price for active properties increased 16.9 percent from the previous month to $450,000. So far, property prices are up 31.4 percent from June 2020. It may take some time for values to fall because sellers are still trying to obtain top money for their property. Sellers are attempting to price their houses in line with recent comparables that closed in 2021—when mortgage rates were still at record lows and inventory was scarce.

However, many purchasers are waiting to see what happens in the autumn housing market, when there will be more inventory as well as greater competition. There is a lack of consensus on whether or not now is a good moment to purchase a house. In contrast to the most recent housing crash, which occurred during the financial crisis of 2008, we are currently experiencing growing inflation while job levels continue to be solid. The majority of economists were surprised by how quickly jobs were added in June.

The jobs market has been seen as the bulwark against a recession, and June’s numbers show that the employment pillar remains strong. Job growth accelerated at a much faster pace than expected in June, indicating that the main pillar of the U.S. economy remains strong despite pockets of weakness. Nonfarm payrolls increased 372,000 in the month, better than the 250,000 Dow Jones estimate and continuing what has been a strong year for job growth, according to data from the Bureau of Labor Statistics.

“The strong 372,000 gain in non-farm payrolls in June appears to make a mockery of claims the economy is heading into, let alone already in, a recession,” said Andrew Hunter, senior U.S. economist at Capital Economics.

The years that you anticipate living in the house is another factor that might play a role in determining whether or not you should buy it right away. Those who do not intend to remain in the house for at least five years after the purchase may end up losing money if the housing market experiences a crash after the purchase and they decide to sell. On the other side, attempting to time the market incorrectly might result in you missing out on the opportunity to purchase your ideal house.

You may be priced out of the market if interest rates continue to climb and home prices do not fall by an amount that is sufficient to compensate for high mortgage expenses. Buyers are in a better position to take advantage of the increasing availability of houses now that sellers are asking for more reasonable prices for their properties. If there is a downturn in the economy, mortgage interest rates will very certainly fall to about 4 percent or even lower. If it does, it could be a good time to hold off and save some money, especially for first-time homeowners.

What Types of Loans Can You Get for an Investment Property?

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When you start searching for mortgage options, you will probably find out that there are different types of mortgage loans to choose from for an investment property. With so many types of loans, you may most likely don't know where to begin. You know you need to pick the best mortgage rate, however, you ought to comprehend this doesn't really mean going for the mortgage with the lowest rate.

This is because there are some other variables to consider which can influence your decision. There are some mortgage options that you should know about financing investment properties. Let us discuss the 4 most popular types of mortgages in real estate.

Different Types of Loans You Can Get for an Investment Property

types of mortgage loans

1. Conventional Loans

Conventional lending is the most popular source for mortgage lending in today’s 1 to 4 unit properties. Conventional lending can be either conforming or non-conforming. If it's conforming, it will be for an amount under a specified maximum. In most areas, this is $417,000 for a single family home, but the amount is higher in certain areas, like Hawaii or metropolitan cities. When you are purchasing a multi-family property will graduate up to $625,500. Nonconforming mortgages are for higher amounts usually called a jumbo loan.

The biggest difference between a conventional mortgage and other mortgage programs is the required down payment. Government Sponsored Real Estate Financing Programs have low down payment requirements to help home buyers move into a primary residence.

For example, you could get a FHA mortgage with just 3.5% down and a VA mortgage with no down payment. Banks have different requirements for the down payment on a conventional mortgage ranging from 3% to 20%. For investment property loans FHA or VA does not offer a non-owner occupied programs. Occasionally loan servicers that are reselling a previously funded VA loan that was inherited through foreclosure will offer a qualifying assumable option to investors to purchase that property. These types of transactions are very few and far between.

Most of your 1 – 4 unit property transactions are typically sponsored by Fannie Mae or Freddie Mac.

2. Portfolio Loans

In the real estate market, there are two main categories of mortgages that prospective property buyers will encounter: “traditional” mortgage loans and portfolio mortgage loans. A portfolio loan is a loan that is serviced by the lender that issued the money. It can help you get a mortgage when you can't qualify for a traditional mortgage because of bad credit or documented income. Here are the basics of the portfolio loan and how it works. Before the mortgage crisis of 2008, there were many portfolio lenders in the marketplace offering non-prime loans to investors.

The most famous product that many seasoned investors utilize was the “Option Arm.” The Option Arms typically offer a lot of flexibility from the standpoint of payment options as well as qualifying options. Many say that the Option Arm was abused in many ways which allowed loan officers to put families into homes that they really couldn’t afford. This part is true in some cases, but for investors, it made a lot of sense on paper because of the flexible payment options. With the new Dodd-Frank Act in place, portfolio lenders were forced to eliminate these products.

Portfolio lenders act very much the same way as your normal conventional lenders, but with different guidelines. Most all their loans are underwritten manually. A portfolio lender is a bank or other institution that originates mortgage loans and holds a portfolio of loans instead of selling them in the secondary market. For example, Bank of Internet USA is nationally recognized for its Portfolio Loans, flexible, custom-built mortgages that are created to meet the unique financial needs of individual homebuyers.

They do not rely on Fannie Mae or Freddie Mac’s underwriting engine to approve their loans. Each loan is examined differently to make sure the loan falls within the portfolio guidelines. These lenders do have a niche in the marketplace because sometimes these loans do not fall into the normal conventional guidelines. These are not subprime lenders but make sense lenders. Their down payment and loan terms requirements may vary as well as their credit requirements.

3. Private Money Loans – Hard Money

Private mortgages provide investors substantial returns at interest rates that are compounded several times annually. The rates on these types of loans are much higher than that of the traditional conventional loan, not to mention the upfront cost. Private mortgages (also called “Hard Money Loans,” trust notes, private notes, etc.), are in my opinion, much safer than paper investments because they are secured by real property. I have personally seen settlement statements where hard money lenders that charge four & five points upfront at closing with interest rates anywhere from 10% to 20%.

It is completely legitimate for an individual to offer a private mortgage for a home purchase giving a buyer a non-bank option for financing. Many rehabbing companies will take advantage of hard money because of the short-term nature. It allows a rehabber to purchase the property and roll in the closing cost in addition to the rehab cost. Once the rehab is done, the property is sold for a profit, and the hard money loan is paid off. Traditional lending is focused on the long-term loans, where private moneylenders can get a much higher interest rate and higher cost for easily accessible money to conduct their business on a short term basis.

Some of the main reasons why investors use hard money are that underwriting will not be as rigorous as conventional lending. However, in this new era of “The Ability-to-Repay,” banks and mortgage companies are refusing more borrowers than ever before. These home buyers are coming in droves to private lenders to find the private mortgage they need to buy a home. Even though hard money loans are extremely expensive, they do serve a purpose in today’s lending community.

4. Non-Recourse Loans – IRA Loans

A non-recourse loan does not allow the lender to pursue anything other than collateral. For example, if you default on your non-recourse home loan, the bank can only foreclose on the home. They generally cannot take further legal actions against you. The bank is out of luck, even if the sale proceeds do not repay the loan.

Most investors would prefer using a non-recourse loan over a recourse loan simply because of this fact. With both types of loans, the lender is allowed to seize any assets that were used as collateral to the secure loan.

The most popular type of non-recourse lending for the 1 – 4 family property category is a self-directed IRA. Self-directed IRAs can purchase investment real estate as another form of tax-sheltered retirement investment. The IRS requires non-recourse loans for all real estate purchases that use leverage from within their self-directed IRA.

Many investors will use their IRAs to purchase real estate in today’s market. Some use self-directed IRAs to purchase real estate because they can’t qualify in the traditional conventional lending. It could be for the fact that their credit profile does not meet today’s standards or they’ve maxed out on the number of loans that Fannie Mae or Freddie Mac will allow.

Specialty lending companies that support self-directed IRA transactions for real estate will require you to set up a separate entity into an LLC for each of property. These lenders will approve the loan the same way commercial lenders do which means they are underwriting the property more so than the borrower.

Non-recourse loans typically require a larger down payment and a much higher interest rate. Even though the rates are higher than what they can get on the conventional side, it is still not as difficult as private money lending. Many real estate investors that utilize self-directed IRA’s typically will have a shorter business plan and earlier exiting strategy, typically 5 to 7 years.

Will New Tariffs Actually Lead to Lower Mortgage Rates in 2025?

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Have you ever heard the saying, “It's always darkest before the dawn”? Well, in the world of economics, sometimes things that seem bad on the surface can have unexpected silver linings. Right now, there's a lot of talk about new tariffs, and while my initial reaction might be to worry about higher prices, there's a chance these tariffs could actually push mortgage rates down. It sounds a bit backward, I know, but let's dive into why new tariffs might indeed lower mortgage rates, even if the path isn't exactly straightforward.

Could New Tariffs Actually Lead to Lower Mortgage Rates? Here's What I Think.

The Surprising Link Between Tariffs and Mortgage Rates

Here's the core idea: when there's economic uncertainty, investors tend to look for safer places to put their money. One of those safe havens is typically U.S. government bonds, particularly the 10-year Treasury yield. This yield is a crucial benchmark because it heavily influences the cost of borrowing for things like mortgages, especially the popular 30-year fixed-rate mortgage.

Think of it this way: if new tariffs create worries about the economy slowing down, investors might flock to buy Treasury bonds. This increased demand for bonds can drive their prices up, and when bond prices go up, their yields tend to go down. And as the 10-year Treasury yield falls, so too can mortgage rates. We saw this happen recently when the latest tariffs were announced – the 10-year Treasury yield dipped.

Why Economic Uncertainty Can Be Good for Borrowers (Sometimes)

It feels counterintuitive, I know. You'd think a strong economy would be good for everyone, including homebuyers. And in many ways, it is. But when the economy is booming too much, it can lead to higher inflation. To combat inflation, the Federal Reserve might raise interest rates, which in turn pushes mortgage rates higher.

Tariffs, while intended to protect domestic industries, can sometimes have the unintended consequence of slowing down economic growth due to increased costs for businesses and consumers. If the economy shows signs of cooling, investors might become more risk-averse and, as I mentioned, turn to safer investments like Treasury bonds. This increased demand helps keep those yields, and consequently mortgage rates, in check or even pushes them lower.

The Recent Data Points to This Trend

We've actually seen this dynamic play out recently. Following the announcement of new tariffs, the 10-year Treasury yield saw a decrease. This is a direct reaction to the uncertainty these tariffs introduce into the economic outlook. Some experts have even suggested that this could lead to lower mortgage rates in the short term.

For example, data indicates that the 30-year fixed mortgage rate has averaged around 6.92 percent this year, but it had already dipped to 6.67 percent earlier this month. While there are many factors at play, the reaction of the Treasury yield to tariff news suggests a potential for further downward pressure on mortgage rates.

However, It's Not All Smooth Sailing for Homebuyers

While lower mortgage rates sound great, the impact of tariffs on the housing market isn't entirely positive. Here's where things get a bit more complicated:

  • Inflationary Pressures: Tariffs can increase the cost of imported goods, which could lead to higher inflation. Even though lower mortgage rates might make monthly payments a bit more manageable, higher prices for everything else could still strain household budgets and make homeownership less affordable overall. The latest Consumer Price Index already showed overall inflation at 2.8 percent, with housing costs remaining stubbornly high.
  • Increased Construction Costs: Tariffs on materials like steel and lumber can significantly increase the cost of building new homes. One study even suggested that existing tariffs could increase new-home construction costs by 4 to 6 percent. Given that new construction makes up a significant portion of the available housing inventory right now, this could further limit supply and keep overall housing prices elevated.
  • Economic Uncertainty and Job Security: If tariffs lead to a significant economic slowdown, businesses might be less likely to hire, and some people could even lose their jobs. This increased uncertainty about job security could make potential homebuyers hesitant to make such a major financial commitment, even if mortgage rates are lower. Buying a home is often tied to confidence in one's financial future.

My Take: A Double-Edged Sword

In my opinion, the idea that new tariffs might lower mortgage rates is plausible, at least in the short term. The historical relationship between economic uncertainty, Treasury yields, and mortgage rates suggests this could indeed happen. However, I don't think this is necessarily a straightforward win for homebuyers.

The potential for increased inflation and higher construction costs could offset the benefits of lower mortgage rates. Ultimately, the overall affordability of housing depends on a complex interplay of factors, including interest rates, home prices, and the general economic health of the country.

Potential Opportunities for Some

Despite the uncertainties, lower mortgage rates could create opportunities for certain groups:

  • Refinancing: Homeowners who purchased their homes in the last couple of years when rates were higher (around 7 percent) might find that lower rates offer a chance to refinance their mortgages and potentially save a significant amount of money on their monthly payments.
  • Buyers in Specific Markets: In areas where there's already a decent supply of homes and demand softens due to economic uncertainty, lower mortgage rates could give buyers more negotiating power and potentially make homeownership more accessible. As one expert put it, “Everything’s this local supply and demand dynamic.”

What Should Potential Homebuyers Do?

Given this complex situation, my advice to anyone thinking about buying a home would be to:

  • Stay Informed: Keep a close eye on economic news, particularly reports on inflation, GDP growth, and the housing market.
  • Shop Around: Compare mortgage rates from different lenders. Even small differences in rates can add up to significant savings over the life of a loan.
  • Assess Your Personal Finances: Carefully evaluate your own financial situation and job security before making a decision. Don't let lower rates tempt you into overextending yourself.
  • Do Your Due Diligence: Research the local housing market in your area. Understand the supply and demand dynamics and be prepared to negotiate.

In Conclusion

While new tariffs could create the economic uncertainty that leads to lower mortgage rates, this potential benefit comes with significant caveats. The risk of higher inflation and increased construction costs could still make homeownership challenging. It's a complex situation with both potential opportunities and risks for homebuyers. As always, understanding the bigger economic picture and carefully considering your own circumstances is key.

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