Interest Rates really do affect your Mortgage Payment |
| You
are buying a house, what is more important further negotiations to
lower the purchase price $500 or accepting the current offer?
"Jim, that's easy, always go with the best (lowest) price!" Let us say the offer came to your agent Tuesday and by Thursday you should have final agreement and acceptance. Not bad saving $500 for just 2 more days of negotiations. The final offer you accepted was $122,000. Tuesday the interest rate for your 30 year fixed loan interest rate was 6.25%. It is now Friday and your agent has faxed your contract to your mortgage company so your loan can be "locked." Your agent discovers that the interest rate has gone up to 6.5% which your agent tells you is still a very good rate. Let us do a little math. Your payment on your new contract price for just principle and interest is $772. But, the interest rate on the $122,500 offer at the previously available interest rate would have been $754. The extra cost on your mortgage payments after 10 years will be $2,100. In fact you make an extra $500 on the contract price in just a little over 2 years. Lesson of the story - interest rates can have a larger effect over time then small changes in the contract price. It is most important to be mindful of interest rates and the changes they can have on your mortgage payment especially as you negotiate your contract. |
| Interest rate commentary
(Moving.com) provides a daily assessment of the mortgage market and
provides their recommendations based upon an analysis of the data.
But, If the rate you are offered is good then it is problem
an unwise decision to gamble and wait for a better rate. |
| Mortgage Loan Payment Calculator |