Home Buyer's Recession Survival Guide - How To Ride The Interest Rate Spikes

No one has a crystal ball which can predict what the Fed is going to do next, but it is generally agreed that the roller coaster is on its way up for a while. If you're waiting for the return of the 3.5% mortgage you might be waiting for a while. You have to just tighten your safety belt and start riding that coaster car up up and away.

Now is a good time to get rid of your home equity line of credit. You might want to try to get a home equity loan in order to do so, as most of these lines of credit are tied to the prime lending rate, and the interest on that loan could get fairly loansharky soon. Keep in mind that a home equity line of credit is not just another unsecured loan like a credit card where the worst they can do is hassle you with phone calls and put a black splotch on your credit report. You mess with the home equity line of credit lender and you'll find yourself out on the street.

If you currently have an adjustable rate mortgage, drop whatever you're doing and go shop around for someone, anyone who will give you a comparable fixed rate mortgage. The more you wait, the more this will cost you serious money.

Weigh carefully the trends in your community, as each one is different. Don't just rush out and buy the first house you see in fear of spiking rates. Keep in mind that much of the nation is suffering a price deflation so by next year, you might be paying 1.5% more for a mortgage, but if that same house costs $50,000 less, you will definitely come out ahead.

If you're in the market for consumer credit:

a) take out a home equity line of credit to cover consumer purchases only if Torquemada has you stretched out on his torture rack like the Fantastic Four's Reed Richards.

b) jump on any legitimate zero interest rate deals now while they still exist. They are an endangered species and definitely on their way out.

c) be very aware of the "fixed rate" credit promotions. Sure, they're fixed rate now, but by law all they have to do is give you 15 days written notice and they can spike that rate to whatever they want.

d) Detroit is on its knees right now and they're giving away cars. If the old jalopy can't take another rebuild, shop around for the best deal not only on price, but terms as well. There are some ridiculously low financing offers out there that may be worth taking on.

But the best advice in this rate scenario is simply to defer consumer credit. In the mid '70s the prime was at 12%, a decent mortgage was considered to be 16% and some new car loans hit 30%. There is no clear indication that the situation is going to get that crazy anytime in the near future, but caution is definitely called for!

Read The Entire Survival Guide

Home Buyer's Recession Survival Guide - The Subprime Meltdown
Home Buyer's Recession Survival Guide - The Advantage Of Renting Over Buying
Home Buyer's Recession Survival Guide - Why Rent? Why Not?
Home Buyer's Recession Survival Guide - Five Common Mistakes House Buyers Make
Home Buyer's Recession Survival Guide - Get Your Home Sold Quickly & At Your Asking Price
Home Buyer's Recession Survival Guide - Improve Your Home's Value And Sell It For More!
Home Buyer's Recession Survival Guide - Learn The Value Of Curb Appeal
Home Buyer's Recession Survival Guide - Home Staging: Valid Selling Technique Or Fraud?
Home Buyer's Recession Survival Guide - Before You Go House Shopping
Home Buyer's Recession Survival Guide - The Home Condition Checklist
Home Buyer's Recession Survival Guide - Getting A Mortgage From Different Types Of Lenders
Home Buyer's Recession Survival Guide - What To Do After You're Turned Down
Home Buyer's Recession Survival Guide - New Initiatives To Help Get You Approved
Home Buyer's Recession Survival Guide - Isn't HUD An Old Paul Newman Movie?
Home Buyer's Recession Survival Guide - Jumbo Isn't As Huge As He Once Was
Home Buyer's Recession Survival Guide - FHA Q&A
Home Buyer's Recession Survival Guide - The FHA's Credit Requirements Vs. The Bank's
Home Buyer's Recession Survival Guide - Your Credit Score And Your Mortgage
Home Buyer's Recession Survival Guide - Credit Score Confusion
Home Buyer's Recession Survival Guide - Keeping That Credit Score Nice & High
Home Buyer's Recession Survival Guide - Minimize The Interest Payable
Home Buyer's Recession Survival Guide - What Is PMI & Why Do I Care?
Home Buyer's Recession Survival Guide - The LIBOR-COFI-COSI Alphabet Soup
Home Buyer's Recession Survival Guide - REO: Get Rich Quick Or Just Waste Time?
Home Buyer's Recession Survival Guide - Obtaining Flipping Money
Home Buyer's Recession Survival Guide - Consider The Additional Costs
Home Buyer's Recession Survival Guide - What Is Escrow?
Home Buyer's Recession Survival Guide - Tips To Avoid Foreclosure
Home Buyer's Recession Survival Guide - The Changing Value Of Your Mortgage Dollar
Home Buyer's Recession Survival Guide - How To Ride The Interest Rate Spikes
Home Buyer's Recession Survival Guide - Can't Get A Mortgage? What A PITI!
Home Buyer's Recession Survival Guide - Calculating Your Closing Costs
Home Buyer's Recession Survival Guide - Mortgage Broker or Mortgage Banker?
Home Buyer's Recession Survival Guide - The Magic Of A Down Payment
Home Buyer's Recession Survival Guide - A Refinance Checklist
Home Buyer's Recession Survival Guide - Refinancing With Bad Credit
Home Buyer's Recession Survival Guide - The Self-Employed Mortgage Maze
Home Buyer's Recession Survival Guide - VA Loans
Home Buyer's Recession Survival Guide - Offset & Reverse Mortgages
Home Buyer's Recession Survival Guide - The Reasons To Not Buy An Offshore Retirement House
Home Buyer's Recession Survival Guide - How To Pay Less Than $500 A Month
Home Buyer's Recession Survival Guide - Five Easy And Cheap Tips To Save Big $ On Energy

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