Buying a new computer. Going to a festival. Trying out a new restaurant. If you’ve looked at reviews or searched online before doing any of these things, you know what we’re talking about. It helps us make informed decisions and ensure we’re satisfied with our decision—no matter how small. When it comes to buying a house, and more specifically, financing a house, it can be daunting because there isn’t just one quick thing to check. You’re considering whether it’s the right decision for you, the lender you want to choose, the deal you’re getting, and so much more. That puts pressure on you, on the situation, and a lot of FOMO, or fear of missing out. Homebuyer FOMO can look a lot like “Am I getting the best deal?” and “Should I wait for a better interest rate?“ or “Am I getting sold?” So, let’s tackle these questions one by one. (FOMO, no mo.)
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Unlike buying a couch or a TV, a one-to-one comparison takes a little more work with a mortgage. There are variables like lender credits, mortgage points, and completely different loan products just to name a few. For example, a loan estimate from a lender might have a very low interest rate, but they’ve included a higher upfront cost, in the form of buying your interest rate down. If comparing only interest rates from two different lenders, this one may look drastically low compared to another estimate without a rate buydown.
"If you see a loan estimate that blows the rest of your comparisons out of the water, it's a good idea to ask for a locked loan estimate. If a lender balks at sending you a locked one, or requires you to pay to lock in your rate, it's big red flag" says Lower loan expert Jake D. "But, good news is, now you know, and you can start looking for another lender."
To avoid FOMO, the first thing you’re going to want to do is get multiple opinions, or initial loan estimates. Two would be great, but three or more would be even better. Just make sure whoever you apply with has a no-impact credit check to get an estimate. That way, you can get as many opinions as you want, without it affecting your credit score. You can get your initial loan estimate from Lower here. (With no impact to your credit, of course.)
To get a loan estimate, you’ll need to submit an application. (Make sure it won’t impact your credit if you’re getting estimates from multiple lenders.) The way you go about this varies by lender, but usually happens with a phone call or an online application. Get started with Lower here.
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FOMO hits hard when it comes to rates, but it doesn’t need to. Shifting to a more neutral viewpoint can help you avoid FOMO.
A good way to think about it is if you aren’t able to afford the monthly payment of a home at 0%, you still aren’t able to afford the home. And the same goes if you are able to afford the home at 10%. See how taking rates out of the question makes your decision a lot clearer? It’s about you and your wants/situation. Not the market.
So, let’s say you do your due diligence and find the best deal you can right now. Once locked in with a lender and a rate, it can be really easy for the “should I wait for a better interest rate” to creep up. You don’t want to regret the decision after you close or even down the line. In this situation, take a step back and consider three things: are you able to qualify for the loan, does it fit into your budget, and, most simply, do you want to buy a home right now? This change in thinking is how you can avoid FOMO no matter rates go.
This question is also rooted in FOMO, and it makes sense—no one wants to be sold something that doesn’t work for them. So, if your spidey senses are tingly and something feels off, just know that at almost any point, you can get a second opinion. Take a look around and see what other offers are. When talking with another lender, do you get the same hesitations? That can help you get a better picture of whether a lender is a good fit for you.
No matter your question or your FOMO, it’s always good to bring it back to the basics—are you able to qualify for the loan, does it fit into your budget, and do you want to buy a home right now? If you are at peace with those three things, you can kiss FOMO goodbye.