A major consideration in replacing a roof is new roof financing options. We have all seen various news articles regarding the interest rates rising. These articles include talking points speculating the possibility of revisiting the crash of 2008, which leaves a lot of people hesitant to make big purchases or financial moves.
With interest rates almost doubling from two years ago, folks who have a 3.5% interest rate on a flexible rate loan could see a payment double with current rates at 6.5%.
While the crash of 2008 is a significant fifteen years ago, the reality of people’s experiences from losing retirement to losing their homes is fresh in our minds. We find ourselves in a particular moment of time that has become a benchmark to compare current trends in our economy and what move to make.
This is complicated by the fact that Redmond area neighborhoods saw dramatic spikes in housing values over the summer of 2022. The average ROI for most homeowners now sits around 55-60%. That’s amazing.
If a person purchased a home in 2020 for $490,000.00, the cost of the same home increased to $670,000.00. Quite a jump. With those numbers a person could cash in quite well, but buying when the market is high is a risk as well.
Bottom line: most analysts feel a market correction will be seen rather than a crash.
So what to consider as you think about a roof replacement with financing? Ways to offset higher interest rates include applying for an adjustable-rate mortgage, or ARM, which allows you to buy down interest rate points or submit a larger down payment.
The drawback with ARM’s is that they fluctuate with interest rate hikes and falls but tend to be less money up front. Another option: Discover Credit Card has an Affordability Calculator so a person can see how much they can afford for a house in today’s market.
All said, our advice to our customers is to shop around. The best mortgage is the one that isn’t sold to other companies, and believe it or not, there are lending institutions that won’t sell your mortgage.