Homebuyers face challenges as mortgage rates hit 20-year high

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ALBUQUERQUE, N.M. — Earlier this week, mortgage buyer Freddie Mac reported the 30-year fixed-rate mortgage is the highest it’s been in 20 years.

“Anywhere 6.125% to 7.125%, there are a lot of factors involved when it comes to pricing, interest rates, loan programs, credit scores, and whatnot,” said Burgandy Casias, an Albuquerque loan consultant.

Just last year, those rates were around 3% to 4%.

“Mortgage rates tend to rise when we have inflation,” Casias said.

As those mortgage rates increase, buyers can afford less and less.

“For example, a few months ago, they may have been able to purchase a $300,000 home, and now they are qualifying for $280,000, so yes, this is affecting them,” she said.

Casias said there is no telling when rates will fall.

“It’s hard to say,” she said. “We all wish we had a crystal ball to see where rates are going. If they actually do declare a recession, historically, rates do come back down.”

Casias said the increase in mortgage rates isn’t impacting sellers as much – there is still a demand for homeownership. However, homes are sitting on the market longer, with fewer offers.