Mortgage rates seem to be creeping up. In general, they tend to rise when the economy is robust, the job market is healthy and wages are increasing (think Amazon and their rate hike to $15 minimum wage). People usually feel more comfortable plopping down the money for a larger mortgage in these conditions, but what do these rising rates actually mean to home buyers?
See this example given by Clare Trapasso in her 2018 article for realtor.com – on a 30-year, fixed-rate loans at 4.65%, if the mortgage rate increases by just one full percentage point, it costs typical home buyers an additional $147 a month—or almost $53,000—over a 30-year period. (This assumes that a home is about $300,000 with a 20% down payment.). That’s a LOT of dough.
But don’t worry – interest rates are no where near the October 1981 rate of 18.63%! To find out more about the financial implications of rising rates,
click here to see Clare’s full article.
