First-time home buyers

The biggest concerns for first-time home buyers right now are fluctuating interest rates and home values. However, buying a home with a fixed-rate loan now will ensure that future rises in interest rates will not impact your monthly payment.

In addition, because of current market conditions, many first-time home buyers have a large inventory of homes from which to choose. Prices in many markets have stabilized or moved off their highs over the past year as demand has softened, so your dollars could go much farther than they have in the past.

If you decide to move forward with the search for your first home, consider getting pre-approved for a mortgage. Becoming pre-approved will give you a much better idea of your buying power as well as reassure home sellers that you are a serious buyer.

Existing homeowners

If you are a homeowner with an adjustable rate mortgage, hybrid ARM, or interest-only mortgage, now is a good time to consider refinancing into a fixed-rate loan.

Even if the overall interest rate rises, there is a good chance that a fixed-rate mortgage payment will be lower than what you may pay if your adjustable rate loan adjusts soon.

Homeowners currently repaying variable-rate home equity lines of credit also should review their options. Refinancing to a fixed-rate home equity loan could be advantageous, but you should first check with your lender.

Buydowns

Another option, whether you are considering refinancing your current mortgage or exploring your first mortgage, is to elect to buy down the interest rate.

With a "buydown," a borrower or seller pays part of the interest upfront, lowering the borrower's monthly rate for a set period of time.

With the proper research and the assistance of a qualified mortgage professional, securing the right mortgage product can put you in a more advantageous situation to help you meet your homeownership goals.