Mortgage Rates Change Franklin, MA Home Affordability

Once your Realtor & Mortgage Lender help identify your budget, be sure to keep tabs on it. The budget can be victimized by mortgage rates. See, Franklin homes are more affordable today than at any time in recorded history, but it’s not because home prices are down. It’s because mortgage rates are. And every time mortgage rates change, your maximum purchase price changes, too.

Did you know: In June 2011, mortgage rates changed every 3 hours, 23 minutes on average?

With mortgage rates changing as rapidly as they are, your home affordability can be short-lived. Consider the budget-busting impact of rising mortgage rates.

For every 1 percent rise in mortgage rates, a buyer’s maximum purchase price falls 10.75%.

For example, if you have 20 percent to put down and see a $300,000 Franklin, Massachusetts home, today, you can borrow at 4.500% and pay $1,216 monthly. But if you want to wait for a price reduction and, 4 weeks later gets it — all the way to $285,000. You are ecstatic--until you talk to your lender and find out mortgage rates are up 1 point.

That same home — selling for $15,000 less — now costs $1,295 to carry. It’s a $79 monthly increase and $28,440 in extra payments over the life of the loan.

This is why it’s foolish to “time” the housing market.

Give me a call at 508-369-5131 or email franklinmahomes@comcast.net to get started on finding your new home! I have 15 years’ experience & testimonials to make for a smooth and stress free move.