One industry veteran discusses buyer hesitancy and how to help customers overcome it
As mortgage rates dropped over the second half of the year, both homebuyers and homeowners returned to the mortgage market to take advantage of those rates.
However, there is still a sector of potential customers who remain on the sidelines. Some of them may be hesitating due to the uncertainty of the government shutdown. Others may read headlines about future rate cuts and are waiting for them to arrive. A third group is still holding on to ultra-low mortgage rates from the pandemic low-rate market.
Whatever the reason, loan originators are working to both educate hesitant borrowers and use tools to help them get across the finish line.
RJ Baxter (pictured top), branch manager at Choice Mortgage Group in Denver, Colorado, is a veteran of the industry and has seen the market's ups and downs. He said that, despite improving market conditions for buyers, some are still not ready to make a move.
“It's definitely a buyer's market,” Baxter told Mortgage Professional America. “We're seeing, generally speaking, a lot of areas are declining a little bit in home values. People are a little bit cautious. It's definitely been a slower market. Realtors are feeling it, and lenders are feeling it. Denver's always been a super competitive market. From the consumer side, people are cautious and a little concerned.”
Using buydowns
One way that Baxter and others are trying to get hesitant buyers into the market is through temporary buydowns. This allows buyers to get a lower rate for the first year or two of the loan, with the hopes that they’ll be able to refinance to a lower rate before the buydown ends.
“A lot of buyers are seizing the opportunity, because it's a heck of a buyer's market,” Baxter said. “It's a great time to get a good deal on a house. Sellers are willing to negotiate. We're seeing a lot of transactions where we're doing temporary buydowns. We're getting seller concessions to cover closing costs.”
Baxter said using these buydowns requires a bit more explanation to the customer to ensure they understand why it makes sense.
“It's helping people to kind of ease into that higher payment, with the goal being to refinance before they get to the full payment,” he said. “We don't have a crystal ball, but that's a good strategy right now to help make it more affordable.”
Another tool brokers use to overcome potential buyers' hesitation is to explain how much net worth they’re losing, or at least delaying, by continuing to wait.
“We talk to them about the amount of wealth that they can build by buying a home, especially compared to being a renter,” Baxter said. “Instead of being so focused on what the rate is, ‘What's the payment compared to your rent? What does that look like? If you project it out for 5 or 10 years, as far as your net worth compared to renting, you're going to be way better off.’ So when they can look at those kinds of numbers, it takes that focus off what the interest rate is.”
Lowest cost of money
Rather than focusing on the mortgage rate, Baxter explains ways to structure the loan that could save the borrower money. In many cases, buyers don’t understand things until they're explained to them.
“It's not just the rate, it's the lowest cost of money,” he said. “I talk about that a lot with people. What's the lowest cost of the money? You know, points versus no points. What term to look at, how to allocate seller concessions. What's your strategy after closing to manage the mortgage? Things like this are super important.”
Melissa Cohn of William Raveis Mortgage said buyers are becoming increasingly cautious, using inspection periods to renegotiate or walk away from deals. She noted that today’s market gives them room to be more selective.https://t.co/QKj4DM0otz
— Mortgage Professional America Magazine (@MPAMagazineUS) November 5, 2025
Baxter thinks that as the market moves farther from the pandemic-era low-rate environment, customers are starting to adjust their views on current mortgage rates. He believes that’s another factor starting to bring hesitant buyers and sellers back to the market.
“I think that's part of why we've seen an increase in inventory lately, because people are starting to get more used to these higher rates,” Baxter said. “There are more people who are willing to pull the trigger even though they had the 3% mortgage, because of different reasons: family, lifestyle, just wanting to move to a different area, or job changes.
“People still need to move even if they have a 3% mortgage. But also, people are a little bit less stuck on what rates used to be as we get further away from that time period.”
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