Lower Interest Rates Get You More
July 22, 2019
Interest rates are on the decline which is good news for all homebuyers. How low? As much as 1 percent and while that might not seem like a lot at first glance, it’s all you need to get more home for your money.
As recently as late last year, mortgage agency Freddie Mac predicted interest rates as high as 5.1 percent on a 30-year mortgage for 2019. Rates that high have not only notmaterialized, they’ve actually hit an all-time low.
As one of the leading sources for rate forecasts in the U.S., when Freddie Mac slashes it’s prediction to 4.3 percent, buyers should pay attention.
That’s because as interest rates decrease, affordability often increases. As you look for a new home, you may discover that your 20 percent down payment and a loan at a lower mortgage rate could get you a larger home than you originally anticipated.
That could mean the difference between three or four bedrooms, extra square footage or the ability to add upgrades and options.
So how does it work? Your mortgage rate is simply the amount of interest charged by whomever you took a loan out with to purchase your house. A 1 percent difference on a mortgage rate on a $200,000 home with 20 percent down and a $160,000 loan can increase or lower your monthly payment by $100. That doesn’t seem like a lot, but a high rate means you’ll pay approximately $30,000 more in interest over the 30-year term.
Forecasters now predict that the 30-year fixed rate will remain relatively steady through year’s end, not changing by more than a couple of tenths of a percentage point. Afterward, rates could begin to inch upward, which means now is the time to buy.
Where is the best place to buy? Grand Central Park. Our builders offer a range of home prices to fit every budget and no matter which home you choose, you get our signature Grand Central Park lifestyle. That includes all the trails you can hike, trees to rest under and — coming soon — a beautiful new recreation complex with a pool, exercise room and more.
What are you waiting for?