The 30-year fixed mortgage rate has been bouncing between 6% and 7% this year. If you’ve been on the fence about whether to buy a home or not, it’s helpful to know exactly how a 1%, or even a 0.5%, mortgage rate shift affects your purchasing power.
The chart below helps show the general relationship between mortgage rates and a typical monthly mortgage payment:
Even a 0.5% change can have a big impact on your monthly payment. And since rates have been moving between 6% and 7% for a while now, you can see how it impacts your purchasing power as rates go down.
What This Means for You
You may be tempted to put your homebuying plans on hold in hopes that rates will fall. But that can be risky. No one knows for sure where rates will go from here, and trying to time them for your benefit is tough. Lisa Sturtevant, Housing Economist at Bright MLS, explains:
“It is typically a fool’s errand for a homebuyer to try to time rates in this market . . . But volatility in mortgage rates right now can have a real impact on buyers’ monthly payments.”
That’s why it’s critical to lean on your local expert, United Family Mortgage to explore your mortgage options, understand what impacts mortgage rates, and plan your homebuying budget around today’s volatility. United Family Mortgage also offers tailored advice to your specific situation and goals, so you have what you need to make an informed decision.
Bottom Line
For a 2nd opinion or updated mortgage pre-approval letter, contact United Family Mortgage today. When it comes to the biggest purchase of your life, don’t take the first mortgage offer that comes along, contact United Family Mortgage to shop on your behalf. We are a mortgage broker, not a mortgage bank. We will shop for the best mortgage options, rates, and terms for you. Contact us today at 763-241-0306.