Use this calculator to get an idea what your home loan will be monthly.
Remember to add yearly taxes and insurance premium divided by 12 to the payment.
Also Use the calculator to see what a 2% interest rate change does to the affordability of a home.
Example: Take a home priced at $250,000 at an interest rate of 5.5% not including taxes and insurance would be approximately $1,420.00 per month for 30 years. Take the same home priced at $250,000 at an interest rate of 7.5% without taxes and insurance, It would now cost approximately $1,748.00 per month for 30 years. The exact same house priced at $250,000 changed in affordability by $328.00 per month with a 2% change in rate. For years home rates were much
higher then they are right now. Ask your parents if they remember home mortgage rates in the 12 – 18% range. They probably will and it still made more sense then renting. Every day people whip out a charge card and buy dinner, shoes, electronics, gifts etc. and pay interest on stuff that is no longer to be found in a year or two. Usually at a much higher rate of interest then a home which lasts for years and years to come. Eventually being paid off. That’s like the landlord telling you to stop paying rent.
Do the math and start shopping for a home.
Don Maclary Realtor with Howard Hanna William E Wood
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