When Interest Rates Rise...
... many people fall out of the house buying market. This is a mistake. Many of the best mortgages deals become available when lenders are competing for new business and sellers are competing within a smaller buyer pool. You just have to know how to keep the costs down in order to counter the higher interest rates.

One of the best tricks is the buy-down. In a buy-down, a fee is paid at the closing to get a lower interest rate. In a soft market, an anxious seller may be lured into to paying all or part of the buy-down. Another approach is to get the seller to pay some of closing costs, thus lowering the amount of cash a buyer needs to close. Frequently the seller''s costs can be used as a write-off by the buyer (Check with your tax advisor.).

If the market is softening due to rising or higher rates, the price itself becomes an area where a buyer may be able to save a lot of money on a house through some hard negotiating. Lower prices mean lower loan amounts, so don''t be discouraged by higher rates--use them to your advantage.