I’m sharing an example of a recent client’s purchase to illustrate just what, exactly, low rates mean for a buyer today.
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Right now, you’re probably seeing mortgage lenders talk about low interest rates and that now is the time to buy.
For you, as a buyer, what does this actually mean? You don’t want an interest rate, you want a house; in a sense, these guys are selling you on the drill, but you just want the hole.
A low interest rate means that you’ll have a much lower monthly payment. For instance, I had a buyer yesterday get pre-approved for a USDA zero-down home loan, and their interest rate was 2.88%. The house was purchased for $150,000, so the payment, with a zero down loan, was $1,023. You can buy a home for $150,000 and pay less than what you’re paying in rent.
Those who have been in the military can qualify for a VA loan and get a rate that will probably be very similar, and your payment will likely be less than $1,000 on that same $150,000 house.
“A lower interest rate means that you’ll have a much lower monthly payment.”
So when you hear all this hype about interest rates, understand that it’s important for you to talk to a lender. If you guys need help with this, we have the best lenders in town, and we can connect you. They give you a free one-year home warranty and loads of knowledge; you won’t regret talking to Freedmont Mortgage.
Buyers care about the down payment and the monthly payment. Interest rates are great, but only because they allow you to afford more home for your money. Quick disclaimer: I’m not a lender, and I can’t give you numbers on paper, but I can encourage you to start the financing process just so you’re able to see where you stand.
If you have additional questions about this or any other real estate topic, you can reach out to me directly via phone or email. I’m always happy to help.