Mortgage Rates Fall Below 5%by Tim Manni
With mortgage rates below the 5% mark, there has rarely been a better time for first-time and existing homebuyers to begin their search for a mortgage or refinance. Even though certain homebuying incentives — like the homebuyer tax credit — are absent from the marketplace, mortgage rates are again at 50-year lows, creating enhanced levels of affordability.
Don’t Play the Mortgage Rate Waiting Game
Nearly each time mortgage rates land at the lower end of 5% or in the upper-4% range, we warn mortgage shoppers not to play the mortgage rate waiting game.
With rates currently this low, it’s important to understand that rates can increase even faster than they have fallen. If you’re prepared to either buy or refinance, don’t balk at today’s low mortgage rates thinking that they may fall significantly lower. They are unlikely to do so.
How much will a rate increase influence my monthly payment? While we don’t foresee an extraordinary increase in mortgage rates anytime soon, a flare in rates can happen without warning. Even if they do bounce higher, it doesn’t mean that affordability is out of reach.
According to HSH’s Amortization Calculator, the difference in a monthly payment between a 5% and 5.5% interest rate on a $200,000 loan is $61.94. For the same loan amount, the monthly difference between a 5% and 6% interest rate is $125.46, figures low enough to be able to fit in many homebuyer budgets.
HSH in the News
With mortgage rates this low, it’s no surprise that HSH.com has grabbed a lot of press over the weekend and today — including a front page mention in today’s Wall Street Journal.
The HSH in the News section of this blog (in the upper-right hand corner of the page) is where we update our media mentions on a daily basis.
Question? Opinions? Leave us a comment and we’ll be sure to get back to you!