Once again, the Fed refused to lower the interest rates today. How are people who want to buy a home able to buy a home but can't because rates are too high? How do they buy a home?

When interest rates are high and the Federal Reserve does not lower them, it can feel discouraging for buyers. However, there are still several ways people can buy a home, even in a high-rate environment:

1. Down Payment Assistance & Gifts: Many buyers use down payment assistance programs or receive gifts from family to help with upfront costs. Both FHA and conventional loans allow for gift funds, and there are programs specifically designed to help with down payments and closing costs.

2. Temporary Buydowns: Some buyers use temporary buydown programs (like a 2-1 buydown), where the interest rate is reduced for the first couple of years, making initial payments more affordable. The buyer must still qualify at the full note rate, but this can ease the transition.

3. Adjustable-Rate Mortgages (ARMs):  ARMs often start with a lower interest rate than fixed-rate loans. Buyers who expect to move or refinance within a few years sometimes use ARMs to lower their initial payments.

4. Seller Concessions: Buyers can negotiate with sellers to pay for closing costs or even buy down the interest rate, making the purchase more affordable.

5. Government-Backed Loans: FHA, VA, and USDA loans often have more flexible credit and down payment requirements. VA and USDA loans can offer 0% down for eligible buyers, and FHA allows as little as 3.5% down.

6. Expanding Search Criteria: Some buyers adjust their expectations—looking at smaller homes, different neighborhoods, or homes that need a little work—to find something within their budget.

7. Improving Credit & Finances:  Buyers can work on improving their credit scores, paying down debt, or increasing their savings. A better credit score can help secure a lower rate, even in a high-rate market.

8. Assumable Loans: Some government-backed loans (like FHA and VA) are assumable, meaning a buyer can take over the seller’s existing mortgage and its lower rate, if the lender approves.

9. Waiting for the Right Opportunity: Some buyers choose to purchase now and refinance later if rates drop, or they wait for a market shift that better fits their financial situation.