Mortgages

If you could have refinanced your mortgage in 2016 but didn’t, you might regret it. Mortgage rates ended 2016 at their highest levels since 2014, capping the end of a refinancing boom.

Mortgage rates rose rapidly after the presidential election, to above 4.25 percent. They are expected to keep rising, but slowly, in 2017.

READ MORE: Here’s how to figure out when and if you should refinance your mortgage.

The Mortgage Bankers Association predicts that the 30-year fixed-rate mortgage will rise gradually over the year, averaging 4.7 percent in the fourth quarter of 2017. The National Association of Realtors expects the 30-year fixed to be around 4.6 percent at the end of this year.

RATE SEARCH: Are looking to relocate? Find the best mortgage rates at Bankrate.com right now.

Just because rates are rising doesn’t mean that you have to rush out to buy a home as soon as possible. McBride points out that no one gets married just because there’s a sale at the bridal shop.

If you worry that rising interest rates will make it impossible to afford your first home, consider getting an adjustable-rate mortgage, or ARM. A 5/1 ARM starts out with a rate that stays fixed for the first five years. Then, the rate adjusts annually after that.

“Now is a good time to look at adjustable rates, especially for the first-time homebuyer,” says Dick Lee, managing director of MSA Mortgage, in Newton, Massachusetts.

Lee says people typically live in their first homes for five years or fewer before moving up to bigger houses. So, even if they get 5/1 ARMs, a lot of first-time homeowners will have moved on before their first rate adjustment.

Read more about the basics of adjustable-rate mortgages, then use Bankrate’s fixed-versus-ARM calculator.

RATE SEARCH: Is your credit mortgage-ready? Get your free credit score at myBankrate today.

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