Home Buying in Michigan>Question Details

Lindsey, Home Buyer in Michigan

I am a first time homebuyer with a FHA MSHDA mortgage with DPA, I just had my offer accepted on my first

Asked by Lindsey, Michigan Mon Dec 8, 2008

home, our current interest rate is 6.75%, should we lock in right now, or wait until closer to the closing date in January? Do you think the rates will lower any?

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Try us at http://www.mshdalender.com Rates are set by mshda but I may be able to help you if you haven't bought yet.
Web Reference: http://www.mshdalender.com
0 votes Thank Flag Link Sun Jul 12, 2009
Lindsey, it is so unfortunate that you agent is able to help you. BUT, I am so glad that you are finding that there are professional, knowledgeable agents out there who can help you. Keep asking questions if you need to.
0 votes Thank Flag Link Wed Dec 10, 2008
our agent isn't informed on much of anything, we had no other options for the situation on choosing a better agent- long story. We have asked our mortgage broker about the options available and will go over them to see what will get us the best deal. I am thankful to the agents who do know their stuff on here, thank you for all of your help.
0 votes Thank Flag Link Wed Dec 10, 2008

I have a client in the midst of a Rural Development loan right now. Do you have a Buyer's agent? This is something a Buyer's agent should have gone over with you long before your offer was accepted ... or even presented, for that matter.

0 votes Thank Flag Link Wed Dec 10, 2008
Lindsey, Great news on the rate! Rural Development loans are still a true zero down payment program. You may want to check into that further. Of course you and the house have to qualify. Keep us posted and good job on being so well informed!
0 votes Thank Flag Link Tue Dec 9, 2008
I talked to my lender today and she said the FHA without mshda will be at 5.25% so that is better than the 6.75%, we're also looking into the rural development loan, any thoughts ? ( Thanks so much for the replies and all the info)
0 votes Thank Flag Link Tue Dec 9, 2008
6.75%?? Ouch. Do you have a challenging credit situation?
Web Reference: http://www.DoorToDreams.com
0 votes Thank Flag Link Tue Dec 9, 2008
MSHDA rates are set directly by MSHDA regardless of the participating lender you use and if you use DPA then they are usually about 1/4-1/2% higher.

As a point of reference, you can probably get a standard FHA loan for about 5.5-6.0% right now however you'd need to come up with 3% to put down. Normally MSHDA rates are a little bit below market levels but looking at the MSHDA website that doesnt appear to be the case currently.

I think the general expectation is that rates will go down in the near future, but at this point it's all speculation and who knows what will happen. As we've seen the last 6 months, anything can happen in the short term. I have seen rates change my .75% (both up AND down) within the same week!

If you have some savings or can maybe get a gift from a family member then maybe you can do a normal FHA loan, but if you're stuck with MSHDA then the decision to lock or not is up to you.

The questions I ask my customers when they are agonizing over locking their rate or floating are these:

If rates go up, will your loan still be approvable? If you are treading on thin ice then by all means lock it in

To assess your stomach for risk - which situation would upset you more? If you locked in today and rates went down 1/2% by closing or if you didnt lock in and they went up 1/2%??

Use these questions to help you make your decision. You'll never know which was the right move until it's in hindsight anyway but at least it'll help you sleep at night.

Best of luck!
0 votes Thank Flag Link Tue Dec 9, 2008
Lindsey, talk to your lender and ask their opinion. As Missy mentioned that rate is high. Typically if you qualify for FHA you get to take advantage of their low rates; wondering why yours is higher. The rates are expected to continue to drop in the short term.
0 votes Thank Flag Link Tue Dec 9, 2008
That is high, rates are now under 6% and suppose to go to 4.5% after the first of the year. Do you know why your rate is higher now?
0 votes Thank Flag Link Tue Dec 9, 2008
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