How to take advantage of today's low mortgage rates: Credible CEO

Low interest rates in housing market spur homebuying frenzy

The number of Americans buying homes rebounded in May to a record 44.3 percent after a steep decline in April due to the coronavirus pandemic.

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Mortgage buyer Freddie Mac reported earlier this month the average rate on the key 30-year loan declined to 3.13 percent from 3.21 percent -- the lowest level since Freddie began tracking average rates in 1971.

FOX Business' Maria Bartiromo noted on Tuesday that finding a dream home may be challenging with “severe shortages creating bidding wars for what’s available.”

In turn, Credible Founder & CEO Stephen Dash offered tips on "Mornings with Maria" to those potential homebuyers as the housing market surges.

“Before you start looking for a home, tip No. 1 is: Get a pre-approval online,” Dash suggested. “This is a letter that takes into account your specific situation. It’s not a rate range or a market rate, it’s a real preapproval and it tells you what your buying power is."

Credible is majority-owned by FOX Business' parent company, Fox Corporation.

US HOME PRICES INCREASE 4% IN APRIL

Dash also offered another tip: Optimize your credit score and down payment.

“When you’re going through the search process for a home or an apartment, make sure you take care of your credit through that time,” Dash mentioned, adding that aspect is "really important.”

He reminded people that it's not a good idea to take out a loan or open a new credit card when checking your credit as they can often impact your score.

“Don’t let your credit card debt run more than 30 percent of the limit," Dash also cautioned.

He encouraged people to double-check their credit reports to make sure there aren't any mistakes.

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“Your credit report is really important, as is your down payment,” Dash explained.

Dash encouraged to save as much as possible for a down payment. Most importantly, potential homebuyers should check their rates before locking in a mortgage.

“Take into account the total cost of a mortgage including appraisal fees, mortgage insurance and other closing costs,” he said.

The Associated Press contributed to this report.

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