Buying a Home Without Waiting for Lower Interest Rates

by Rick Cavallaro

Many buyers hesitate to enter the market, hoping for mortgage rates to drop. However, delaying a purchase may not always be the best strategy. Instead, exploring different financing options and understanding the current housing market can help buyers make smart decisions now

Understanding Today’s Mortgage Rates

Mortgage rates have seen ups and downs over the past year. Currently, the average 30-year fixed rate is 6.09%, which is lower than its peak of 7.22% in May. While rates are higher than previous historic lows, waiting for further drops is uncertain. Holding off on buying could mean missing out on opportunities especially if home prices keep climbing

Alternative Ways to Finance a Home Purchase

Rather than waiting for rates to decrease, buyers can explore different financing options to secure better terms:

Assumable Mortgages – Some loans, especially government-backed ones, allow buyers to take over the seller’s mortgage, often at a lower interest rate.
Seller Financing – In certain cases, sellers may offer financing directly to the buyer, providing more flexible payment terms.
"Subject-To" Agreements – This method allows buyers to take over the seller’s mortgage payments without officially assuming the loan, which can be beneficial if the existing rate is lower than current market rates

Before committing to any of these options, it's crucial to consult with a real estate or mortgage professional to determine the best approach.

Housing Market Trends and Home Prices

Beyond mortgage rates, home prices are a key factor in affordability. Experts anticipate that home values will continue to rise rather than decline, even with high interest rates and limited inventory. This means waiting for lower prices may not be a viable strategy. Buying now could allow homeowners to start building equity as property values appreciate (Keeping Current Matters, 2025).

The Risks of Waiting to Buy

Postponing a home purchase in the hopes of lower rates or prices could lead to:

Lost Equity Growth – Renting means paying for someone else’s investment instead of building your own wealth.
Increased Housing Costs – If both interest rates and home prices rise, affordability may become even more difficult.
Missed Tax Benefits – Homeownership offers tax advantages that renters don’t receive

Steps to Take Now

If you're ready to buy a home, consider these actions:

Evaluate Your Finances – Check your credit score, debt-to-income ratio, and savings to determine your purchasing power.
Get Expert Guidance – Work with real estate professionals and mortgage lenders to explore your financing options.
Look Into Homebuyer Assistance – Investigate first-time buyer programs, down payment assistance, and government-backed loan optionsfor added support

Taking the right steps today can help buyers enter the market with confidence without waiting for lower mortgage rates.

Source: Keeping Current Matters, 2025