INTEREST RATES

How payments change with different interest rates How putting less than 20% down affects rates

The best time to buy or sell is during periods of low Interest rates.   The buyer benefits if rates are low from reduced payments.  The seller can benefit because a prospective buyer can afford a higher priced home if rates are low.  We are currently experiencing rates lower than have been available for forty years.

 

Here is an example of how interest rates affect the payment on a    $150,000 loan over 30 years: 

 

Interest rate:  5%  7%  9%   11%
Payment:   $805   $997 $1,207  $1,428

                                                

An important consideration is the effect of a larger down payment.  Below is a graph that gives an estimate of the increased closing costs and long term interest rate depending on the down payment percentage.

 

DOWN PAYMENT EXTRA LOAN COSTS HIGHER INTEREST RATE
20% 0% 0%
10% 0% .4%
5% 0% .7%
3% 1.5% .95%
0%  0% 1.5%
Estimates only!  Figures vary depending on borrowers qualifications.

    

                                         

 Find out what they are right now at :

SmartMoney.com

 

 

 

 

 

 

 

 

 

 

 

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