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Are you risking $65,992 or more?
September 22, 2017 | Kyle Foster
Are you risking $65,992or
more? In speaking with hundreds of home buyers using our home search website FosterColorado.com this summer we've noticed that many of you are wishing
to wait until next summer to purchase a home. We get it, Autumn is in the air, it's getting colder and the thought of moving is dreadful. Although we understand how you feel, we also want to stress the risk of waiting to purchase in the Denver Metro area.
Rates are on the Rise
Let's compare interest rates rising over the next year:
Today's approximate 30-year FHA interest rates are floating around 4.5 %
That equates to a monthly payment of around$1520 /month.
Over the 30 year life span of the 4.5% interest loan, you will pay a total of $547,220 to payoff your $300,000 mortgage.
Interest rates are due to rise over the next year. If they rise to 5.5% you will see the following increase in cost on the same loan.
Monthly payment will increase from $1520/month to $1723/month
Over the 30 year lifespan of the loan will rise from $547,220 to $613,212.
With an increase of 1% in mortgage interest rates you could end up paying an extra $65,992
in purchase price by waiting until next summer to move. Also THIS CALCULATION IS FOR INCREASED MORTGAGE INTEREST ONLY! It does not include the money you would also lose if the home prices rise in the next year!
Of course this is a hypothetical situation and I'm not trying to force you into moving before you're ready. I just want you to have enough information to make a good decision. Please let me know if you have any questions.