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Home Purchasing Power…
Your home purchasing power is essentially how much home you can afford.
Home purchasing power could be affected by slight interest rate fluctuations. When interest rates are low, you tend to be able to afford a higher priced home. When interest rates increase, that same home could become more expensive for you and your payment may be higher.
How Rates Affect Purchasing Power
Below is an example* of how a small rate increase could affect your mortgage payment. Rates have been at all time lows for some time and there is only one direction they could go. It is anticipated that they will increase this year. Don’t miss out on an incredible opportunity now.
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Purchase Price $1,500,000*
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30-year fixed rate: 5.5%
Payment: $8160
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30-year fixed rate: 6.375%
Payment: $8791
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Assumptions: no points, 25% down payment, payment includes principal, interest, taxes and insurance*
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Purchase Price $520,000*
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30-year fixed rate: 4.875%
Payment: $2843
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30-year fixed rate: 5.75%
Payment: $3070
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| Assumptions: no points, 20% down payment, payment includes principal, interest, taxes and insurance* |
Price Versus Payment
When buying a home, take into consideration both price and monthly payment. Before you begin shopping though, you will need to know your home purchasing power. I would be happy to refer you to a trusted mortgage professional to get you started on a pre-approval…
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* This comparison is an example and not a loan guarantee. Payment is an estimation for this example only. Approval subject to, but not limited to, satisfactory appraisal, preliminary title report, clear inspection (if required by contract or appraisal), minimum credit scores and employment history. For accurate pricing, please consult a mortgage professional. We’d be happy to refer you to a trusted partner.
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