Helping homebuyers and homeowners get ahead of rising interest rates.
After a prolonged period of aggressive interest rate hikes to combat inflation, which sent mortgage rates soaring, the Federal Reserve finally began lowering rates last year. This trend is expected to continue in 2025. While mortgage rates have gradually declined since reaching a 23-year high in 2023, they have yet to dip below the 6% mark, and many experts anticipate 30-year fixed mortgage rates will likely remain in the mid-6% range for some time.
With that in mind, Consolidated Credit’s housing team is here to help. Whether you’re looking to buy a new home or refinance the one you’re in, Consolidated Credit’s housing team has answers. We also have a number of programs and upcoming events that can help you, too. To speak with a housing counselor today for free, please give us a call at 1-800-435-2261.
Understanding the cost of buying or refinancing a home
Costs for homebuyers
When purchasing a home, it’s important not just to consider the purchase price. You must also factor in the significant initial costs of homeownership and current mortgage rates.
Common costs for buying a home:
| Purchase price (base cost): | Varies, depending on the agreement reached with the seller |
| Lender fees/mortgage costs: | 3% – 20% down payment, alongside .5% – 1% of the loan for origination fees |
| Inspection: | $300 – $500 (additional charges for optional inspections) |
| Appraisal: | $300 – $500 |
| Title: | $2,000, though can vary |
| Insurance, property taxes, and HOA fees: | Vary greatly, available to you prior to submitting your offer |
| Maintenance: | Varies from community to community, or left to do yourself |
Costs to refinance
- Rate-and-term refinancing changes your interest rate, loan term, or both without advancing any new money.
- Cash-out refinancing is when an existing mortgage gets replaced with a new one but comes with a larger amount than previously owed, allowing borrowers to use their mortgage to get cash. It’s a form of home equity borrowing. As interest rates rise, the number of homeowners who can refinance to a lower interest rate decreases. Thereby denying them the opportunity to decrease their monthly payments.
Common costs for refinancing a home:
| Application fee: | $75 – $300 (could be more) |
| Origination/underwriting fee: | .5% – 1.5% of principal loan |
| Recording fee: | *Depends on location* |
| Appraisal fee: | $300 – $400 (more expensive for larger properties) |
| Credit check fee: | $25+ |
| Title services: | $700 – $900 |
| Survey fee: | $150 – $400 |
| Attorney/closing fee: | $500 – $1,000 |
If you need help assessing those costs, reach out to one of our certified housing counselors today 1-800-435-2261. We’ll look at your financials and determine where your financial health stands. If you need help saving up for these costs, we can help you create a budget to reach your goal.
Homebuyers: Should you buy a house now?
The best time to buy a home differs for everyone and depends on your unique needs and financial circumstances. Mortgage rates and house prices remain higher, but it’s difficult to tell what the housing market will be in the future. Also, for new homeowners, buying a home now allows you to start building equity immediately, regardless of market trends. So, if you can afford the upfront costs of a house, it may make sense to buy now. There are currently programs that help you afford these costs.
Sandra Tobon, Consolidated Credit’s Director of Housing and Community Outreach, explains…
“The home-buying process is not easy. It takes time. You don’t want to just go to the bank and see if you are approved or not it’s not the right process. Instead, call us and start getting educated and familiar with the process. There are many components that are part of our first-time homebuyer program.”
Sandra tobon, director of housing counseling & community outreach at consolidated credit
If you are considering buying a new home, now is the time to start. If you are stuck and don’t know where to begin, the first-time homebuyer program is a good place to start.
We also invite you to join us online for a free homebuyer orientation class to help you get started.
Homeowners: Is it a good time to refinance?
For many homeowners, it’s a good idea to refinance if you can lower your interest rate. When you consider that dropping your rate by 1% puts back almost 10% of your payment into your pocket, it’s easy to see why people are still doing it.
However, the savings need to outweigh the closing costs. You do have refi closing costs to pay and need to consider that you are agreeing to start another long-term mortgage.
Should you need help assessing the costs and see if refinancing is worthwhile, don’t hesitate to contact one of our certified housing counselors today.
“I know a lot of people that took full advantage of the refinancing process, three or four months ago when interest rates were low. However, if you pull the note from your bank and you have an interest rate of eight-point something and you’re going to lower it to five, that is a big change. So, everything depends on the interest rate you have right now.”
Free webinar helps you save money either way
Consolidated Credit hosts a free webinar designed to help homebuyers find smart ways to save money as the real estate market continues to be advantageous for sellers. It will also explain the costs and how to save if you plan on refinancing your home.
Webinar On Demand
Buy or Refi: How to Save Big Either Way
Whether you’re looking to begin your buying journey or if you are looking to refinance, there are many ways you can save a dime. It all begins with a little budgeting…
