Today, the U.S. jobs report showed a gain of 528,000 in July. That’s nearly double the expectated amount.
On some fronts, it’s a good sign the economy is growing, companies are strong and unemployment is ticking down. However, with more people working with more money to spend, chasing fewer goods, inflation is likely to continue climbing.
This is not what the Federal Reserve Bank wants to see. Their goal is to slow inflation which means there’s a good chance they will raise interest rates another 75-basis-points at their next meeting in September.
Bi-weekly mortgage payments?
If you’re looking to take the sting out of higher mortgage rates and home prices, consider making two half payments on your mortgage every month. Twenty-six half payments per year equal 13 full payments, saving you a full month of interest in the course of a year.
A biweekly payment could be a good strategy to help you save money over the life of the loan.* Plus, it helps pay off your mortgage faster.
One of the keys to making biweekly mortgage payments manageable is having a budget and sticking to it. Not all lenders will allow biweekly mortgage payments, but as you can tell, it’s worth looking into.
FHA rates down, too!
The national average rate for a 30-year fixed Federal Housing Administration (FHA) loan moved down to 4.7%.** If you’re a homebuyer with less-than-ideal credit and lacking the 20% to put down, which means experts believe an FHA loan might be a good option.
Some first-time homebuyers don’t consider government-backed mortgages because they think they’re for people with lower incomes and credit scores. Sure, government loans are wonderful options for less-qualified borrowers, but they also feature a number of benefits for other consumers. This increasingly popular mortgage requires a lower credit score to qualify, and gives buyers the option to put as little as 3.5% down.
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Applicant subject to credit and underwriting approval. Not all applicants will be approved for financing. Receipt of application does not represent an approval for financing or interest rate guarantee. Restrictions may apply.
* Savings, if any, vary based on consumer’s credit profile, interest rate availability, and other factors. Contact Guaranteed Rate for current rates. Restrictions apply.
** National average rates accurate as of 8/5/22 from Mortgage News Daily and are not advertised rates from Guaranteed Rate.
John Kistner is Guaranteed Rate’s Market Analyst. Market Updates are designed to provide readers with a high-level yet insightful view of how economic news, events and trends affect mortgage rates and the homebuying process.