Wow!! As I write this I’m looking at local interest rates today and I can’t believe how GOOD they are. I would have never thought that rates would go below 3% for a 15 year mortgage, but they have. The rates I’m looking at show today’s 15-year fixed rate mortgage at 2.95% and a 30 year at 3.75%. If you haven’t refinanced lately, maybe it’s time to look into these great rates. The other thing that is attractive about these rates is that it makes it a great time to move up to that larger home. Let me demonstrate:
If you currently have a $100,000 mortgage at 6%, your Principal and Interest (P&I) is $599.55 each month. With the new rates you could buy a $130,000 home and have a $602.05 per month payment for 30 years. That a $2.50 increase per month. If your current morgtgage is $200,000 at 6% your P&I is $1199.10/ month and for about the same money you could buy a $260,000 home.
So, if you want to stay where you are, look at refinancing to either reduce the length of time on your mortgage or to reduce your payments; but if you’re looking to move up to a larger home, then use these great rates to buy more for the same money. Either way, you and your family wins. There are also institutions that are offering “no cost” refinancing.
Let us know if we can recommend a lending institution or help you in moving up to a new home.