Fixed rates now vs variable rates in 2024

searcher profile

April 13, 2024

by a searcher from Northeastern University in New York, NY, USA

Working on a project and I got pitched a fixed 10-year note that is 3% lower than whats on the market with variable rates today. Thoughts on fixed notes? Where do you think rates will go?

0
4
131
Replies
4
commentor profile
Reply by a lender
from University of Georgia in Atlanta, GA, USA
What is the actual % because 3% discount may or may not be 3% for all lenders. You are going to have to decide how long you think it will take for rates to fall more than 3% and how far you think it may fall beyond the 3% because that is the time you are getting ahead on the variable vs fixed you are being offered.. Then at that point figure our what your savings is. If you can prepay/refi what is the cost of doing that? This is really just a cash flow decision.
commentor profile
Reply by a lender
from Northwestern University in Chicago, IL, USA
This is a unique time to take advantage of the inverted yield curve with a fixed rate, especially with so much economic (and therefore Fed) uncertainty. Could be worth locking.
- Read the fine print on prepayment penalties. Those could bite depending on your horizon.
- Ask lender for their variable rate on the same loan proposal for apples to apples. As always, shop around as well to know the full set of options.
commentor profile
+2 more replies.
Join the discussion