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  • Dec 5: Rates Tick Up 0.01%—Here's What Actually Matters 📈

Dec 5: Rates Tick Up 0.01%—Here's What Actually Matters 📈

Friday-specific angles: weekend assignments, week-in-review

Author

Alex Veytsman
December 05, 2025

🎯 The Lending Letter 📊

Friday Rates: Holding Steady as We Head into the Weekend

Happy Friday! 🎉 You made it through another week, and you know what that means—it's time to check in on what mortgage rates are doing before you clock out. Spoiler: they're being annoyingly consistent, which is both boring and kind of reassuring. 🤷

📈 TODAY'S 30-YEAR FIXED RATE
6.24%
According to Mortgage News Daily | December 5, 2025
⬆️ Up 0.01% from yesterday

☕ The Friday Rate Report: Minor Moves, Major Patience

Today's rate ticked up by exactly one basis point from yesterday. For those keeping score at home, that's basically nothing—we're talking about a difference of maybe $2-3 on your monthly payment for every $100k borrowed. The bond market is in wait-and-see mode, which means lenders aren't making any bold moves before the weekend. 📉

The reality? We're sitting in a surprisingly stable range right now. After weeks of volatility, rates have settled into the low-to-mid 6% territory like they're planning to stay a while. This isn't necessarily bad news—predictability is underrated in mortgage lending. 🎯

📊 What's Actually Driving This?

The Fed meets later this month, and markets are basically holding their breath. Recent economic data has been mixed—employment numbers remain strong, but inflation indicators are sending conflicting signals. Translation: nobody wants to make big bets before we get more clarity. 🤔

For borrowers, this means opportunity. When markets are uncertain, lenders compete harder for business. And competing lenders = better deals for you. Simple math. 🧮

💰 Lender Promos: December Deals Are Here

🏠 Shopping for Any Type of Property? Primary residence, second home, or that cabin in the woods you've been dreaming about—fill out this quick form and we'll connect you with lenders who are actively closing deals this month.

🏢 Investment Property Goals? December closings mean you can start claiming deductions for the full year. Even if you only own the property for a few weeks in 2025, those tax benefits kick in. Connect with investment specialists here who understand the timing game.

🏖️ Building an STR Portfolio? Smart investors are already locking down properties for next summer's rental season. Get matched with STR financing experts here who know how to make the numbers work in your favor.

🎓 Educational Deep Dive: The Appraisal Gap Clause Explained

Let's talk about something that's been causing headaches lately: appraisal gap clauses. If you're not familiar with these, buckle up—this could save you thousands. 💸

Here's the scenario: You offer $450,000 for a house. Seller accepts. You're excited. Then the appraisal comes back at $430,000. Now what? 😱

💡 Understanding the Gap

The Basic Problem: Your lender will only loan you money based on the lower of the purchase price or the appraised value. So even though you agreed to pay $450k, the bank will only lend on $430k. That leaves you with a $20,000 gap to figure out. 🤯

Your Options:

1. Renegotiate the Price
Ask the seller to lower the price to match the appraisal. In a balanced market, this often works. According to NAR data, about 40% of sellers will renegotiate when faced with a low appraisal. Worth a shot! 🎯

2. Bring More Cash
Come up with the extra $20k out of pocket. Not ideal, but sometimes you love the house enough to make it work. Just make sure you're not stretching yourself too thin. 💰

3. Walk Away
If your contract has an appraisal contingency (and it should!), you can cancel the deal and get your earnest money back. The CFPB notes this is a standard protection for buyers. 🚪

The Appraisal Gap Clause Twist:
In competitive markets, some buyers offer to cover the gap—meaning they'll pay the difference between appraisal and offer price, up to a certain amount. Example: "Buyer will cover appraisal gap up to $15,000."

Should You Include One?
Depends. If you're competing with multiple offers, it makes your bid stronger. But it also means you're committing to bring extra cash if needed. Zillow's research shows that offers with gap coverage are 22% more likely to be accepted in competitive markets. 📊

Pro Tips:

  • Always cap the amount you're willing to cover (e.g., "up to $10k")
  • Make sure you actually have that cash available—don't overcommit
  • In slower markets, skip it entirely—you have more negotiating power
  • Get a pre-appraisal estimate if you're worried (costs a few hundred bucks but can save you from surprises)

🏘️ For Real Estate Investors: The Friday Strategy Session

Friday afternoons are when serious investors plan their next moves. Here's what smart money is thinking about right now: 🧠

The December Closing Rush
We're in prime time for year-end tax planning. If you close on an investment property before December 31st, you can claim depreciation for the entire year—even if you only own it for three weeks. That's potentially thousands in deductions. IRS Publication 527 has all the details, but the short version is: time matters. ⏰

STR Market Update
Winter bookings for ski properties and warm-weather destinations are looking strong for 2026. AirDNA data shows that occupancy rates in top STR markets are projected to remain robust, and ADRs (Average Daily Rates) are holding steady. If you're considering an STR investment, now's the time to lock in financing and find that perfect property. 🏖️

Advanced STR Strategies:

  • 💰 Cost segregation studies can accelerate depreciation and create massive paper losses to offset your W-2 income (if you qualify as a real estate professional). This is advanced-level tax strategy but incredibly powerful.
  • 🛋️ Need to furnish and outfit your property? Check out our 0% interest funding partner for furniture, renovations, and amenities. Why tie up your cash when you can use free money? 🎁

Market Timing Reality Check
Some investors are wondering if they should wait for rates to drop. Here's the math: If rates drop 0.5% next year but property prices increase 5%, you're actually worse off. Freddie Mac's historical analysis shows that trying to time the market based on rate predictions is a losing strategy. Buy when the property makes sense, not when rates are "perfect." 📈

🔧 Personal Finance Hack: The Mortgage Offset Strategy

💰 The Offset Account Concept (and US Alternatives)

This is a strategy popular in Australia and the UK that most Americans don't know about: offset mortgages. While true offset mortgages aren't common in the US, understanding the concept can help you implement a similar strategy. 🧠

How Offset Mortgages Work:
Imagine your mortgage balance is $300,000. You have $50,000 sitting in a linked savings account. With an offset mortgage, you only pay interest on $250,000 ($300k - $50k = $250k). Your savings "offsets" your mortgage debt, but you still have access to that cash. 🎯

Why This Is Brilliant:

  • You save on mortgage interest (currently around 6.24%)
  • You keep access to your cash for emergencies
  • You avoid taxes on savings account interest
  • You pay down your mortgage faster without being locked into higher payments

The US Alternative Strategy:
Since true offset mortgages are rare in America, here's how to replicate the benefits using tools we do have:

1. The Readvanceable Mortgage Approach
Some lenders offer mortgages with integrated HELOC components. As you pay down your mortgage principal, that equity automatically becomes available as a revolving credit line. You can then park extra cash in a high-yield savings account and only draw on the HELOC if needed. Investopedia explains this is closest to a true offset mortgage available in the US. 💼

2. The Chunking Strategy
Make large lump-sum principal payments whenever you have extra cash, but maintain a HELOC as your emergency backup. This gives you the interest savings of paying down your mortgage while keeping liquidity available. 🏦

The Math:
Let's say you have $30,000 in cash earning 4.5% in a high-yield savings account (that's $1,350/year before taxes, maybe $1,000 after taxes). If you put that $30k toward your 6.24% mortgage, you save $1,872/year in interest. That's an extra $872 in your pocket annually, guaranteed. 📊

The Catch:
You need to have a cash cushion or backup liquidity (like a HELOC) for emergencies. Don't put every dollar toward your mortgage and leave yourself exposed. According to Bankrate's guidance, keep at least 3-6 months of expenses liquid before implementing this strategy. ⚠️

Who This Works For:
This strategy makes the most sense if you're:

  • Disciplined with money (you won't drain your HELOC for impulse purchases)
  • Have stable income
  • Plan to stay in your home long-term
  • Comfortable with some financial complexity

Action Step:
Talk to your lender about whether they offer mortgages with integrated HELOC features, or ask about setting up a standalone HELOC after your mortgage closes. Not every lender offers these, but they're becoming more common. 🎯

📊 This Week in Mortgage Markets: The Data Dump

Let's rapid-fire through what actually mattered this week (because you probably missed it while dealing with actual work): 📰

Economic Data Mixed Bag
This week's economic reports painted a confusing picture. Job growth remains solid, which normally would push rates higher, but wage growth moderated, which suggests inflation pressure might be easing. Markets basically shrugged and said "we'll wait for more data." Classic. 🤷

Inventory Still Climbing
According to Realtor.com's latest numbers, active listings continue to increase year-over-year. More options for buyers = more negotiating leverage. If you've been waiting for better conditions, this is actually it. 🏠

Regional Variance is Real
Zillow's market data shows some regions are seeing price corrections while others continue climbing. Markets like Austin and Boise are normalizing after their pandemic booms, while areas like the Southeast continue to see strong appreciation. Location still matters more than national trends. 📍

Lender Competition Heating Up
December is typically slow for lenders, which means they're competing harder for the business that exists. Translation: if you're shopping for a loan right now, you have more leverage than you might think. Don't settle for the first quote—make lenders compete for your business. 💪

🎯 Weekend Assignment: Check Your Credit Score

Since it's Friday, here's your weekend homework (don't worry, it takes 5 minutes): check your credit score. Not because there's anything wrong with it, but because knowing your score gives you power. 💪

Most people think they need to pay for credit monitoring. Wrong. You can check your actual credit reports from all three bureaus for free at AnnualCreditReport.com (the government-mandated free site, not the sketchy imposters). 🔍

Why this matters: Every 20-point jump in your credit score can save you about 0.25% on your mortgage rate. On a $400k loan, that's roughly $60/month, or $720/year, or $21,600 over the life of the loan. For checking a website. That's a pretty good return on 5 minutes of effort. 💰

Quick Wins to Boost Your Score:

  • Pay down credit card balances below 30% of your limit (ideally below 10%)
  • Don't close old credit cards—age of accounts matters
  • Dispute any errors you find (there's a 30% chance you'll find at least one, according to FTC research)
  • Become an authorized user on a family member's old, well-managed card

🚀 Ready to Make Your Move?

Whether you're buying, investing, or just exploring options, we've got you covered:

🌟 The Friday Bottom Line

Rates at 6.24% aren't making headlines, but they're also not preventing deals from happening. The fundamentals haven't changed: real estate remains one of the most reliable wealth-building tools available, even at current rates. 🏠

The people who succeed in real estate aren't the ones who wait for perfect conditions—they're the ones who execute when opportunity meets preparation. And right now, with inventory improving and lenders competing for business, there's more opportunity than you might think. 🎯

As you head into the weekend, remember: knowledge is power, but action is what builds wealth. Whether you're running the numbers on your first rental property or refinancing your primary residence, the best time to start was yesterday. The second best time is today. Even if it's Friday afternoon. 📆

Have a great weekend, do something fun, and remember—the market will still be here on Monday. Although with how fast things move these days, who knows what rates will be doing by then. 😄

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See you Monday for another week of mortgage market intel!

Disclaimer: This newsletter is for informational and entertainment purposes only. Rates and terms vary by lender and borrower qualifications. Always consult with a licensed mortgage professional, tax advisor, and financial planner for your specific situation. The strategies discussed require careful consideration of your personal financial circumstances and risk tolerance.