Rising mortgage rates are sidelining many would-be homebuyers. But there are two ways to meet the challenge.

One option -- paying "points" and lowering the rate for the life of the loan -- is costly at first, but could be less expensive in the end. The other option -- adjustable-rate mortgages, whose rates start lower but can increase -- is cheaper at the start, but might ultimately cost more.

The key to both options is how long you plan to stay in the house -- or, alternatively, how long you have to hang on to the loan before it makes sense to refinance. As usual, you must do the math to determine which is best for your circumstances.

A point is 1% of the loan amount. So, if you have a $300,000 mortgage, a point is equal to $3,000. And each point paid buys a permanent reduction in your rate. Here's an example worked up by Patrick Casey of Fulton Mortgage in Chevy Chase, Maryland, based on his company's current rate sheet.

Say you're looking at a 30-year fixed-rate loan at 5.75% on that $300,000 house. If you paid a point upfront at closing, you could buy the rate down to 5.375%. That 0.375% difference would lower your monthly payment for principal and interest from $1,751 to $1,680 -- a difference of $71 each month.

Now, most of us don't have thousands of extra dollars lying around, and most buyers -- especially first-timers -- want to cut their initial outlay, not increase it. But for move-up buyers selling their old places at top dollar, paying points is something to consider.

"Sometimes it pays to pay," says Casey.

If you have the extra money, you should figure out how long it would take to recoup your investment in points, which is where the arithmetic comes in.

In the above example, it will take 42 months. That is, by dividing your savings into your cost -- $71 into $3,000 -- you find that in roughly 3 1/2 years, you will have made good on your extra investment. After that, it's all gravy: Remember, your rate never changes.

Another alternative is to add that $3,000 to your down payment, bringing the mortgage down to $297,000. But in that case, your payment would be just $53 a month lower and you wouldn't break even until 56 months go by.

The choice is yours. You might decide to just keep that $3,000 in your pocket. But if you're after the lowest payment possible, your decision should depend on how long you expect to keep the house before selling or refinancing.

If you're in it for the long haul, it would make sense to buy a point or two -- if you have the cash. But if you believe you'll move on in three years or less, keep your wallet closed.

Whether or not to opt for an adjustable-rate mortgage also rests, at least in part, on how long you plan to remain in the house. But in this case, short-termers are the main beneficiaries.

Like their name suggests, ARMs come with rates that adjust at various times. The rate can go up or down annually -- or less often, such as every three, five or seven years, depending on the loan. But ARMs come with safeguards so that the rate doesn't rise by too much at each adjustment, nor over the life of the loan.

In today's market, a 7/1 ARM is popular: The rate remains set for seven years, then adjusts annually after that. At the first adjustment, it could go up by as much as 5 percentage points, depending on the market at that time, but it can never go any higher. If the rate doesn't adjust by that much on the first ratchet, it can jump 1 percentage point each time -- but again, never by more than 5 points over the life of the loan.

The benefit is that the rate on ARMs start somewhat below the market. That's why there's been a rush on these of late: Earlier this month, 11% of all loan applications were for adjustable mortgages, the Mortgage Bankers Association reports. And the "introductory" rate on a 5/1 ARM -- one that remains set for five years and then adjusts annually -- was 4.47%, as opposed to 5.53% for a 30-year fixed-rate loan.

Let's look again at our $300,000 mortgage, this time as a 7-year ARM with 5/1/5 rate caps. Based on Fulton Mortgage's rate sheet, the monthly principal and interest payment would be $1,543. That's a $208 savings over a 30-year fixed-rate mortgage at 5.75%.

So, are you a gambler? No one knows where mortgage rates will be next week, let alone seven years from now. If our hypothetical loan were to adjust today, the rate would jump by the maximum allowable 5 points, bringing it well over 9%. Then again, it might never get that high.

The question, then, is: How long do you keep the loan, or the house? If you expect to move within seven years, you are ahead. If you stay longer, you could lose, depending on future rates. You could refinance, but rates could be even higher then, or your financial situation may have changed so that you wouldn't qualify.

Remember: The examples here are based on one lender's offerings; every lender has different pricing structures and rates. It's always wise to shop around.

The pandemic inspired millions of workers to make a break for it and leave their offices and jobs behind -- many to start their own businesses or try part-time work.

But COVID-19 also led the two largest suppliers of money for home loans to tighten their underwriting standards, making it more difficult for so-called "gig workers" to qualify for financing.

Now, Fannie Mae and Freddie Mac -- the government-sponsored enterprises that purchase loans from primary lenders and bundle them into securities for sale to investors -- have lifted some of their more onerous requirements. As a result, funding should be more plentiful.

Indeed, California mortgage broker Jeff Lazerson believes that once the word is out, a flood of people who employ themselves or work part-time jobs will soon enter the homebuying scrum.

Gig workers are defined as independent contractors, on-call workers and temporary workers. Typically, they enter into formal agreements with on-demand companies to provide services to the company's clients. Musicians are gig workers, as are Lyft drivers, some tax preparers -- even syndicated housing columnists.

Prior to the pandemic, the Bureau of Labor Statistics estimated there would be 10.3 million of these workers by 2026. But since COVID struck, it's likely that figure will have risen much higher. Pew Research recently put the number at 16 million.

During the pandemic, lenders were required to obtain a year-to-date profit-and-loss statement reporting revenue, expenses and net income from self-employed borrowers if they wanted to sell their loans to Fannie and Freddie, as most do. Borrowers also had to present their most recent bank statements.

That didn't work for those gig workers who were paid cash, did not use banks or had no accountant to prepare the required documents. But now, those rules are gone and some lenders, perhaps sensing a grand opportunity to boost market share, are targeting gig workers directly.

Perhaps the most prominent lender in the country, Detroit-based Rocket Mortgage, is one of those. It advises self-employed borrowers to keep a careful eye on their all-important debt-to-income ratios. It also wants them to keep their credit in check and keep business expenses separate from personal expenses.

Another top lender, United Wholesale Mortgage, is offering bank statement loans for the self-employed. The Pontiac, Michigan-based wholesale lender does not originate loans directly; rather, it funds loans written by local mortgage brokers.

UWM recently told its lender-clients that it will allow "qualified borrowers" to provide their personal or business bank statements, as opposed to their tax returns, to qualify for a loan up to $3 million. The company's bank statement loans also allow down payments as low as 10%, and there is no need for mortgage insurance, a significant add-on many lenders charge when the down payment is less than 20%.

Smaller lenders that offer specialty mortgages are also reaching out to the self-employed. A typical one, Sprout Mortgage of Port Saint Lucie, Florida, makes a direct appeal, touting loans based on bank statements rather than W-2s or tax returns.

"We understand you love your freedom, you appreciate flexibility and you're ready to purchase a home, but you don't have all the documentation a typical mortgage requires," the company says on its website.

Meanwhile, in an indication this lending niche is growing, technology is catching up. For example, Freddie Mac has launched a new feature that analyzes direct deposit data to help underwriters make better decisions. According to Freddie, 97% of all workers, both full- and part-time, now use direct deposits.

At the same time, LoanLogics, a Jacksonville, Florida, technology firm, is supporting Freddie's initiative to expand "rep and warranty" relief eligibility. It does so by providing IRS data to be used to check the accuracy and integrity of the tax return data used to calculate borrower qualifying income. The insurance-like program protects lenders from data errors that can result in the miscalculation of income, which in turn could force lenders to buy back loans.

One of the big problems with gig workers is accounting for their sometimes-spotty, sometimes-seasonal and otherwise irregular incomes and debts. But LoanLogics' product will assist underwriters in calculating self-employment and nontraditional income from any source, the company says.

Fannie Mae is also expanding its verification process, albeit manually. When the required data is not instantly available digitally, underwriters now will be able to keep the process moving by turning to credit reporting agency Equifax for verification requirements.

Of course, not all gig workers drive part-time for DoorDash or sleep in their parents' basements. "Gig economy workers generally have full-time employment, are college educated, use the gig economy to supplement their income and make about $50,000 or more per year in total," a Fannie report says.

Still, there is a downside to lending to those who work in the gig economy. Jobs can end quickly and unexpectedly. Freelancers, for example, are usually let go before staffers. There's some uncertainty about how and when gig workers will be paid, and important benefits like health insurance and bonuses are all but nonexistent.

All in all, though, more gig workers will be able to enjoy the perks of self-employment without worrying that its quirks will prevent them from becoming homeowners.

-- Freelance writer Mark Fogarty contributed to this column.

Ask most agents what they charge to sell a house, and you'll get the standard response: that their fees are negotiable. Ask any agent what they charge to help you find and buy a house, and they'll say the fee is set by the seller's agent and comes out of that agent's commission.

Only the latter statement is true: The agents that buyers use to visit houses and write up a contract are paid their share of the sales commission by the seller's agent. They are paid whatever the seller's agent offers -- usually half of whatever the seller's agent charges.

As far as the listing agent goes, commissions are negotiable -- at least in theory. In practice, though, they hardly ever are, according to a hard-hitting report from the Consumer Federation of America.

In its analysis of 17,800 home sales in 35 cities throughout the country, the CFA found that in 10 cities, at least 87% of sales had identical commission rates. And in 18 others, 70% had the same rate.

In a competitive marketplace, that wouldn't be the case. Rather, the report says, commissions would "vary considerably" because agents have different skill sets and experience levels. They might have to work harder to sell some properties than others, and would likely charge accordingly.

In that perfect world, "it would be very unusual for more than half of all service providers to be charging the same rate for their services," reads the report.

Says CFA Senior Fellow Stephen Brobeck, the report's author, "this rate uniformity is striking evidence of the lack of price competition."

Of course, the industry as a whole does not engage in price setting; that would be patently illegal. Instead, rates are set by individual brokerage firms, Brobeck says. If an agent wants to charge less, they have to seek individual approval from their broker/boss. And if they are given the OK, they usually have to absorb the entire difference.

"Prices are not set in smoked-filled rooms," Brobeck says, hearkening to bygone days of the industry, "... but the effect on consumers is still the same. When an agent tries to deviate from the norm, he runs into difficulty."

Brobeck says sellers' agents also run into trouble if they try to cut into a buyer's agent's fee, because some agents tend not to show houses on which they make less money. Even if the buyer's agent's fee is raised to draw interest, showings diminish because an agent doesn't want to be seen as only taking buyers to places where he or she will make more money.

The way out of this conundrum is to "uncouple" the buyer-side portion of the commission from the seller-side, the CFA report advocates. Previous reports have argued similarly: that allowing each side to pay their own agents will improve the bargaining position of both.

As a rule, listing agents -- technically, the brokers under whose names they hang their licenses -- decide how much the buyer's agent receives. Splits are all over the ballpark, depending on whatever deal the agent and broker can strike. But usually, the broker takes half the fee the listing agent earns, and the buyer's agent splits the remaining half with their own broker.

Because the listing agent sets the other agent's fee, it effectively denies buyers the ability to bargain with their own agents. So says the CFA report -- and so do several lawsuits, including one in Missouri that has been certified as a class action. The Department of Justice is also investigating the situation.

Most multiple listing services require that all brokers specify what cut the buyer-side agent will receive. And that, says the report, is the "linchpin" of a system with uniform commissions. All agents can see the buyer-side fee offered on all listings, which tends to "reinforce the legitimacy" of standard rates, as well as discipline agents who are tempted to deviate from the norm.

"Uncoupling" commissions is not likely to happen anytime soon. The powerful 1.4-million member National Association of Realtors maintains if it happened, buyers would have to pay more at closing. That's true; the buyer would have to pay their agent's fee at settlement.

But the CFA does not find that argument very persuasive. Since commissions tend to be added to homes' asking prices, Brobeck believes the final sales price would be that much lower if there was no buyer-side fee. It may also be possible to add the charge to the buyer's loan amount.

Until an uncoupling day arrives, if it ever does, buyers can ask their agents to rebate a portion of their share of the commission. While a large majority of agents don't offer rebates, some do.

In March, the CFA asked 1,040 buyers if they had sought such a rebate. Sixteen percent did, but only 7% actually received one. Of those who bought in the past five years, 29% asked, but only 6% received. Moreover, nine states -- Alabama, Alaska, Iowa, Kansas, Mississippi, Missouri, Oklahoma, Oregon and Tennessee -- have seen fit to outlaw these rebates.

Still, you can ask, and should. You never know. If enough buyers request rebates, says Brobeck, maybe the industry will sit up and take notice.