We’ve been saying it for years now, how long can these low interest rates last? Just when we think they are starting to climb they head back down again. Yes, housing prices are high nearly everywhere but that is being offset by ridiculously low mortgage rates. Especially now that mortgage rates dropped again!
Here’s what Megastar Financial had to say about interest rates:
“Continuing the pattern of the past few weeks, rates declined again another .11%.This again brings us to a new low for the year and almost 1.15% lower than they were at the beginning of the year.”
A Big Impact
Rates make a big impact on your monthly mortgage payments. For example, a $300,000 loan at 3.5% over 30 years would give you a principal and interest payment of approximately $1347/month. That same loan amount with 4.5% interest makes the monthly payment jump to $1520/month. That’s a significant increase for nothing but the interest rate changing. Interest rates have a huge impact on home affordability. Consider this, if you wait to buy for a dip in housing prices, if rates tick up, while you did pay less for your home, your monthly payment could wind up being about the same.
Calculate for Yourself
If you want to see what your mortgage payment might be, use our mortgage calculator and enter your own numbers. Just remember, the mortgage calculators calculate principal and interest only. You still have to add in property taxes and homeowners insurance.
I never know where interest rates will be next week let alone next year. All we know is they have been good and after this recent mortgage rate drop, they are even better. Consider this, if you wait to buy for a dip in housing prices, if rates tick up, while you did pay less for your home, your payment could be about the same. If buying a home is on your radar, interest rates are still in your favor.