Buying a home is one of the biggest financial decisions you’ll ever make—and it’s natural to have questions, especially in today’s market. Here are two of the most common questions I’ve received from buyers this week, along with expert answers to help guide your journey.

1. Will Mortgage Rates Come Down Soon, or Should I Lock In Now?

Mortgage rates have been hovering around 7% for 30-year fixed loans in recent weeks. While the Federal Reserve has made rate cuts in 2024, those changes haven’t yet translated into significant drops in mortgage rates due to ongoing inflation and economic uncertainty.

So, should you lock in?

If you’re financially ready and you’ve found a home that fits your needs, locking in now may be a smart move. Waiting for a major rate drop could delay your plans without a guaranteed payoff. Plus, refinancing later is always an option if rates do decline.

2. How Much Mortgage Can I Afford?

Great question—and one that goes beyond just what a lender will approve. Affordability depends on your income, current debts, credit profile, and down payment. It also has to do with what your comfort level is.

A rule of thumb that you may find if you do an online search is the 28/36 rule: No more than 28% of your gross monthly income should go toward housing expense. No more than 36% toward total monthly debts (including your mortgage). I would say this is a good “goal” to have; however, it often won’t apply, and it should NOT be a reason to wait. Ratios of 45/50 are a more reasonable goal.

Lenders typically prefer a housing debt-to-income (DTI) ratio under 45% and total under 50%. Though some loan programs, like FHA, offer flexibility up to 55% total. Still, it’s important to focus on what’s comfortable for you and your family, not just what you qualify for.

Have More Questions? Let’s Talk.

I’m here to be your go-to resource. Whether you’re buying your first home or your fifth, I’ll help you navigate credit policy, product options, and everything in between with transparency and care.