Buying a Home with High Interest Rates: 3 Things That Matter Most

Sarah Breck
5 days ago
2 min read

Think high interest rates mean you can’t buy a home right now? Think again.While a 7% mortgage rate might seem like a deal-breaker, it doesn’t have to be—if you focus on the right things. These tips will help you make a smart, confident decision—even with rates on the higher side. Let’s dive in 👇

1. Buying a Home with High Interest Rates Isn’t the Whole Story—Here’s What Actually Matters

Let’s start by busting a common myth: your interest rate is just one part of your mortgage picture.

What also affects your monthly payment and long-term costs:

PMI (private mortgage insurance)
Loan type (Conventional, FHA, VA, etc.)
Lender fees
Property taxes and insurance

Tip: Don’t just go with the lender who advertises the lowest rate.The true cost of your mortgage includes fees and loan structure—compare everything side by side.

Sometimes the “lowest rate” isn’t actually the best deal when you run the numbers.

2. Focus on Your Monthly Payment, Not Just the Rate

Let’s get real for a second.

When I bought my home, I locked in a 5.9% rate. That sounds good in today’s market, right? But my payment made me uncomfortable from the start—and I told myself I’d just refinance later.

Guess what? Years later, I’m still stuck with the same payment. And if I rented it out today, I’d be losing money every month.

Here’s the lesson:A “good rate” doesn’t mean much if the payment doesn’t work for your lifestyle and long-term budget.

Ask yourself:Can I afford this payment comfortably if life throws me a curveball?If the answer is no, it’s time to rethink the price point or structure of your loan.

3. Use Seller Concessions to Buy Down Your Rate

This one’s a hidden gem:You can use seller credits to lower your interest rate.

Right now, it’s common for sellers to offer concessions to attract buyers. You can use that money to pay discount points and buy down your rate, which can drop your monthly payment significantly.

Let’s say a seller gives you $5,000 toward closing costs:

You apply that toward buying down your rate
Your monthly payment drops—sometimes by hundreds of dollars

💡 Pro tip: This works best when coordinated between your agent and lender. Not every loan type allows it, and not every seller will offer it—but when they do, it’s a powerful tool.

Final Thoughts: You Can Buy in This Market — Just Focus on What Matters

Buying a home with high interest rates doesn’t mean your dream is out of reach. It just means you need to:

Look beyond the rate and compare total loan costs
Make sure your monthly payment fits your real-life budget
Use smart strategies (like seller concessions) to lower your payment

Want More Help?

Check out my free Ultimate Resource for First-Time Buyers for step-by-step guides, tools, and strategies designed for this exact market.

Or click here to schedule a buyer strategy call—I’ll help you build a custom plan that fits your goals and budget.