Many things can distract you from the things you’re trying to do in your daily life – worries about health, the news of the day, inflation eating up your paycheck, local issues, the war in Ukraine – all of these are stressful enough for most people but can be especially troubling if you’re also anxious about buying a house. Interest rates are rising with fewer houses on the market, and although higher rates may mitigate the availability problem, affordability can still be an issue. Amid all of those distractions, it’s important to focus on what you can afford each month and what the rates are today when thinking about purchasing a home. Payments are amortized and will be the same throughout the life of the loan, but the percentages paid out in interest versus what goes to the principal will change. Over time, the amount directed to interest goes down as the lender gets paid first, then a more significant amount starts going towards the loan itself. Will a mortgage payment fit within your budget and still leave enough to cover monthly expenses? A little patience and detective work can help you decide if now is the right time to take the plunge.

Pondering the possibility of refinancing your home because you need extra money? All lenders would like borrowers to refinance every four to five years, as that will keep them perpetually paying interest without really touching the principal, thus generating a greater revenue stream for the mortgage companies. How much have you already paid in interest? If you have a good deal of equity in your home, consider looking into a second mortgage or a home equity line of credit, as these options encompass a smaller amount than your original loan and will be paid off more quickly, giving you more available cash now. This week, Jeff’s guests include:

– Charles Giscombe (Malibu Funding) discusses the very latest in rising interest rates.

– Connie Hernandez (PMA Covina) talks about buying in this market.

– Mike Torres (Home Funding Corp) reports on the Albuquerque market.