Monday Market Update: Feb 13, 2017
Posted by: kateg 2 years, 9 months ago
Ever wonder what the effect raising interest rates has on you as a Buyer? As rates continue to inch up, we thought it would be helpful to put the rate changes into real dollars and cents.
To do that, we took a $2,500/mo mortgage payment and broke down the affordability at different interest rates. Keep in mind, that this $2,500/mo figure doesn’t factor in any property taxes nor insurance, but instead is simply a calculation of how much you can afford, at a given interest rate, for $2,500/month.
The results might shock you. Check out the graph below.
At a 4% interest rate, a $2,500/month mortgage equates to a roughly $523,000 mortgage principle.
At a 5% interest rate, a $2,500/month mortgage equates to roughly $465,000 mortgage principle.
In other words, in order to keep your monthly mortgage payment at $2,500, if interest rates were to climb from 4% to 5%, your affordability would go down by $58,000!
Don’t panic, though! Interest rates aren’t expected to rise quickly, so you have plenty of time to lock in a reasonable interest rate to afford the perfect house. If you need suggestions on mortgage brokers, give us a call! We have a team of incredible mortgage brokers who can help you make your dream a reality!Share on Twitter Share on Facebook
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Latest NewsOctober 31, 2019 Happy Halloween from the Coronado Island Realty Family! July 10, 2018 New Landscape Transformation Program Increases Incentives in San Diego County June 29, 2018 624 10th Avenue JUST SOLD! READ MORE
Our initial experience with you, especially with your demonstrable expertise, knowledge, and willingness to both educate and work with us regarding the market and related considerations particular to Coronado, resulted in a gratifyingly helpful and positive experience for us.—Robert R. READ MORE