An eye catching headline to be sure, but also very much the truth.
Interest rates for home mortgages are at historic levels right now which is providing a terrific home buying opportunity! How about this: In 1981 you would have paid 16.90% for a 30 year fixed rate loan. Today, it’s 5.15%, now that is a sale! 😀
Check out the graph below depicting mortgage rates since 1981:
To give this a little meaning, let’s look at a $200,000 mortgage loan:
In 1981, at 16.90% the principle and and interest payment would have been $2835.12. (Wow)
In 2009, at 5.10% the principle and interest payment would be $1085.90 (Now that is a sale)
So you say, “Well that’s great, but that was 1981”. So let’s compare to just 6 months ago then:
August 2008 rates were 6.49% which is a principle and interest payment of $1262.82.
That is a savings of $176.92 per month or $2123.04 annual savings with today’s low rates.
It really is a great time to buy when you consider the low rates and the great inventory of homes.
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