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Cash Investors Competing With New Home Buyers
Affordable starter homes are getting harder and harder to find. This is the sector of the market that has the least available inventory and is also seeing the lowest rates of new construction. But even if a new home buyer can find a starter home to bid on, the odds are stacked against them. Investors and speculators frequently scoop up these homes with cash offers and then put them back on the market at a profit. It is very difficult for new home buyers to compete against these cash investors, even if they have excellent financial profiles and mortgage pre-approval.
30 Year Fixed Mortgage Rate
|Change From Yesterday||-0.054%|
|Change From One Week Ago||-0.078%|
|Change From One Year Ago||-0.150%|
15 Year Fixed Mortgage Rate
|Change From Yesterday||-0.103%|
|Change From One Week Ago||-0.022%|
|Change From One Year Ago||-0.448%|
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Limited housing inventory has changed the home buying process. Most homes that are currently being placed on the market will experience a bidding war. This puts home buyers at a disadvantage against real estate investors, who can often make cash offers and guarantee rapid closings. In most scenarios, a cash offer will be accepted before a mortgage backed offer. This creates a barrier of entry to new home buyers.
Fintech company Neat Lending is offering a $500 discount on closing costs to new mortgage applicants that provide proof of vaccination. The company has justified this incentive by pointing to the effects of vaccination on job availability and stability. Not only does vaccination create a higher chance of maintaining individual financial stability, but a larger pool of available vaccinated workers will also stimulate the overall economy.
Paying your mortgage with your credit card is a bad financial move under most circumstances. However, there is one life hack where it makes sense. Your mortgage payment is one of your highest recurring monthly payments. If you are trying to earn credit card rewards that involve reaching pre-determined spending limits, paying your mortgage with the card might be the fastest way to get there. This tactic only makes sense if you pay your full credit card balance each month.