Mortgage Rates at “Historic Lows”, “60 Year Lows” & “40 Year Lows”
Whatever the headline reads we can all agree that mortgage rates are really low. The benefit of these low rates to Real Estate Buyers can be substantial. The difference between a rate of 4% and 5% on a 30 year mortgage loan of $600,000 can amount to $128,000 over the life of the loan, or $350 each month. If you are waiting for the Real Estate market to drop another 1% or 2% before you buy, consider the following. If rates go up just ½% you will possibly pay $15,000 less for that $750,000 house and end up paying $63,000 more in interest over the life of the loan. You may have heard that the Federal Reserve has promised to keep rates low until the middle of 2013. The problem is that they can and do change their mind if the economic outlook changes. In addition, the Federal Reserve controls short term rates not mortgage rates. Don’t be misled into believing that mortgage rates will stay this low for the next 18 months. There is no guarantee that rates will stay this low. Now is the ti...