Rising Rates Will Change What You Can Afford

 
How increasing interest rates affect how much home you can afford.
 

Let’s talk about interest rates and how they affect you as a buyer. 

If you’re planning to purchase a $280,000 home and put 20% down, you would have a monthly payment of $1,869 at a 3.25% interest rate. Right now, our interest rates are sitting around 4%, so that same house and down payment cost $2,014 a month. That’s a difference of $118 every month.

That might not sound like much, but every time that monthly payment increases, it’ll raise your taxes, insurance, and more. If you stayed in that home for seven years, you’d be paying $14,240 more in interest for that 0.75% climb in rates.

Interest rates are staying steady for now. However, if you’re planning to buy, waiting and letting rates rise might not be the best idea. I know many people are worried about the high prices, but interest rates will have a bigger impact on what you can afford.

If you have any questions, feel free to call us at (210) 324 -7469. We would love to help.

 

Categories: Listing / Buying Tips.