What's Hot: Mortgage Rates Fall Towards 6% Following Fed Cut
$110 a Month: The Difference a Year Makes in Interest Rates
✉️ Want to forward this article? Click here.
For the third week in a row, mortgage rates have settled at 4.10 percent, their lowest level in a year. One year ago, the average interest rate on a 30-year fixed-rate mortgage was 4.57 percent. On Thursday morning, Freddie Mac reported 4.10 percent as the average on the same type of loan. That .47 difference in rates impacts your mortgage payments more than you might think.
Using the example of a home buyer with excellent credit purchasing a $500,000 home, UrbanTurf examined how monthly mortgage payments changed between this year and last. In each case, we assumed the buyer put down a 20 percent down payment. These figures refer just to the principal and interest on a loan, and don’t take into account taxes or insurance.
Here are the two scenarios:
September 2013: The average mortgage rate was 4.57 percent.
Monthly mortgage payment: $2,043
Total outlay on mortgage (monthly payment x 360 months): $735,480
September 2014: The average mortgage rate is 4.10 percent.
Monthly mortgage payment: $1,933
Total outlay on mortgage (monthly payment x 360 months): $695,880
So, the difference between a rate of 4.57 percent and 4.10 percent is about $110 a month, or $39,600 over the life of the loan.
Here’s a look at the path of the rates over time:
The UrbanTurf Mortgage Rate Disclaimer: The rates reported by Freddie Mac for 30-year mortgages are usually the best rates that the most qualified borrowers can get, so borrowers or those considering refinancing should not necessarily read this news and think that they can go out and get a loan with the quoted interest rate.
See other articles related to: mortgage rates, the difference a year makes
This article originally published at http://dc.urbanturf.production.logicbrush.com/articles/blog/110_a_month_the_difference_a_year_makes_in_interest_rates/8931.
Most Popular... This Week • Last 30 Days • Ever
Mortgage rate buydowns can be a good option for buyers who want to save money on inte... read »
Plans filed this week provide the latest look at the 106-key hotel in the works at an... read »
A plan to add another new residential building to the Friendship Heights pipeline is ... read »
The eight-bedroom, 35,000 square-foot home in McLean known as The Cliffs went under c... read »
The large new development would take the place of the Ballston One office building al... read »
- How Does a Mortgage Rate Buydown Work?
- A Look At Georgetown's New 100-Key Hotel Along The Canal
- Donohoe Files PUD For 127-Unit Development in Friendship Heights
- A $30 Million Sale? One Of The DC Area's Most Expensive Homes Finds A Buyer
- Updated Plans Filed For 328-Unit Development At Arlington Office Site
DC Real Estate Guides
Short guides to navigating the DC-area real estate market
We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Start browsing below!
First-Timer Primers
Intro guides for first-time home buyers
Unique Spaces
Awesome and unusual real estate from across the DC Metro