Jeffs Mortgage Minute

# Should You Wait for Rates to Drop? A Veteran Loan Officer’s Take

Everywhere you look, someone has an opinion about interest rates.

“Rates are too high—just wait.”
“Buy now before they go up again.”
“Marry the house, date the rate.”

It’s a lot of noise.

As a veteran loan officer, I don’t have a crystal ball—and neither does anyone else. What I *do* have is a simple, numbers‑based way to help you decide what makes sense for **you**, right now, in your real life.

This article is that framework, in plain English.

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## The Only Three Things That Really Matter

When we strip away the headlines and hot takes, your decision comes down to three pillars:

1. **Payment & budget** – Can you comfortably afford the payment *today*?
2. **Timeline in the home** – How long are you likely to stay put?
3. **Flexibility to refinance later** – If rates drop, can you actually take advantage?

If we can answer those three clearly, the “Should I wait?” question usually answers itself.

Let’s walk through each one.

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## 1. Payment and Budget: Can You Live With the Number Today?

The first and most important question is simple:

**Can you comfortably afford the payment at today’s rates?**

That means:

– You can pay it without holding your breath every month
– You still have room to save, eat, live, and handle small surprises
– You’re not betting everything on future raises or overtime

If the answer is **yes**, then buying now is at least *on the table*, and we can move to the next questions.

If the answer is **no**—you’re stretched too thin or the payment makes your stomach hurt—then waiting, adjusting price, or changing your plan needs to be part of the conversation. No house is worth being constantly stressed.

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## 2. Timeline: How Long Will You Likely Stay?

Your **time horizon** matters more than most people realize.

Ask yourself: “How long do I realistically see myself in this home or area?”

– **A couple of years or less:**
You’re more sensitive to short‑term swings in rates and prices. Transaction costs (closing, moving, potential selling costs) matter a lot.

– **Around 3–5 years:**
You’re getting into a window where owning often starts to beat renting, especially if rents are rising and you’re building equity.

– **5+ years:**
Now you’re playing a long game where short‑term rate bumps matter less than the equity and stability you build over time.

In general:

– The **shorter** your timeline, the more careful we need to be about entering at a higher rate.
– The **longer** your timeline, the more flexibility you have to ride out rate cycles and refinance later if it makes sense.

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## 3. The Real Cost of “Waiting for Lower Rates”

“Waiting for lower rates” sounds smart—until you run the numbers.

Here are some of the costs people forget:

### 1. Months (or Years) of Rent

While you wait, you’re still paying:

– Rent or a mortgage on your current place
– Someone else’s principal, not yours
– Potential rent increases each year

That doesn’t mean renting is bad—it just means we should count it honestly as a **cost of waiting**, not as “doing nothing.”

### 2. Possible Home Price Increases

No one knows exactly where prices will go, but if:

– You’re shopping in a **high‑demand area**, or
– There’s **limited inventory** in your price range,

then waiting could mean:

– Higher prices later
– More competition for the homes you like
– Needing a higher down payment to hit the same monthly payment target

### 3. Lost Time in the Home You Actually Want

There’s a non‑financial cost too.

Every month you wait is a month you’re not:

– Settled into the neighborhood you want
– Building equity in a home that fits your life
– Making improvements that benefit *you*, instead of a landlord

Waiting can be smart—but it’s not free.

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## When It *Does* Make Sense to Wait

There are real situations where pressing pause is the wiser move. Here are a few:

### Your Budget Is Truly Too Tight

If your numbers only work by:

– Assuming big overtime
– Stretching every dollar
– Leaving no room for an emergency

…then waiting while we work on credit, savings, or expectations is responsible, not fearful.

### Your Job or Life Situation Is Uncertain

If you know you’ll likely:

– Change duty stations soon
– Switch jobs or income type
– Go through a major life change (divorce, downsizing, health, etc.)

…then tying yourself to a new mortgage right this second may not be the best move.

### You’re in a Stable, Affordable Situation Already

If:

– Your rent is reasonable and stable
– You’re not being forced to move
– You want to build a stronger financial base first

…then *intentional* waiting—paired with a plan—is not a bad thing.

The key is that you’re waiting **on purpose**, not just hoping rates magically solve everything.

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## When Moving Forward Now Can Be the Better Play

On the flip side, here are times when **buying now**, even at higher‑than‑yesterday rates, can make sense.

### The Payment Works and You’re in It for the Long Haul

If:

– You can comfortably afford the payment at today’s rate
– You plan to stay 5+ years
– You value stability and owning your space

…then locking something in now and planning to refinance later can put you ahead of the person who waited on the sidelines for the “perfect” rate.

### You’re Moving Anyway (PCS, Life Change, Family Needs)

Sometimes, life makes the decision to move for you:

– PCS orders
– New job in another city
– Growing family, aging parents, or school needs

In those cases, the real question is often **“Rent or buy in the new place?”** Waiting for rates in that scenario might just mean paying high rent instead of a higher‑but‑stable mortgage.

### You’re Qualifying Well *Now*—But That Might Not Last Forever

If your current situation looks strong but may change:

– Overtime that won’t always be there
– Dual incomes that could go down
– Credit that’s good today but fragile

…it can sometimes make sense to use the solid moment you have now, as long as you’re realistic about the payment and risk.

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## “Date the Rate, Marry the House”: What That Actually Means

You’ve probably heard this phrase: **“Marry the house, date the rate.”**

Like most slogans, there’s a grain of truth and a lot of oversimplification.

The truth is:

– You are **not** stuck with your first rate forever
– If rates drop and the math works, you can refinance to lower your payment
– The **house**—location, layout, neighborhood—is the harder thing to change

But refinancing isn’t free. You have:

– Closing costs
– Appraisal or lender fees (depending on structure)
– Time needed to “break even” on that refi

So, I don’t tell clients “Don’t worry, you’ll just refi later.” I walk them through:

– What a refinance might cost in the future
– How much a lower rate would actually save per month
– How many months it would take to make that refi worthwhile

That way, if and when rates drop, you’re making a math‑based move—not just reacting to a headline.

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## How I Help Clients Make This Call

Here’s how I walk Veterans and homebuyers through the “wait vs buy” question in real life:

1. **We map your current reality:**
– Income and stability
– Monthly budget and comfort zone
– Current housing situation (rent, own, moving deadline)

2. **We run today’s numbers:**
– What you can qualify for now
– What the payment would be at different price points
– Realistic closing costs and cash to close

3. **We look at a couple of “what if” scenarios:**
– If rates drop by X% in the next 12–24 months
– If home prices move up or sideways in your target area
– If you stay put as a renter that whole time

4. **We make a call together:**
– Move forward now with eyes wide open, or
– Get a concrete 3–12 month plan to improve your position and revisit

No magic, no pressure—just a clear picture so you can choose.

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## Want to See What the Numbers Look Like for You?

This decision gets a lot easier when it’s based on **your** situation, not generic advice.

If you’re on the fence about buying now or waiting for rates to drop, send me:

– Your approximate price range
– Your target area
– Your current rent or housing payment
– A rough idea of your credit and savings
– How long you expect to stay if you buy

I’ll run the numbers like I would for a family member and tell you what I’d do in your shoes—whether that’s “go now,” “wait,” or “change the game plan.”

Use the **“Ask Jeff Your Mortgage Question”** button or the form on my Advice page, and let’s take the guesswork out of this decision.