Mortgage Rates Rise for 30 year fixed loan to 4.29%

Last week, interest rates rise before the Thanksgiving holiday.  Freddie Mac has stated that the average interest rate rose from 4.22% to 4.29% for a 30-year fixed loan rate.  Rates for a 15-year loan rates rose from 3.27% to 3.33%.  

According to the Standard & Poor's/Case-Shiller index released last Tuesday, showed home prices increase in 20 major cities by 13.3% from September 2012.  For example, a home on the market last year was listed at $350,000 will have list price of $396,550 in the current market.  

How is the increase of mortgage rates effect the real estate market?  One factor is the home sales prices are declining which is stabilizing the multiple offer situation we saw earlier this year.  The seasonal trend for the fall and winter is normal to be low.  

The National Association of Realtors reported a pending sale decrease for the fifth consecutive month. 

It will be interesting to see how the market will shift in January 2014 and in the peak season of Spring 2014.  

For more information about the local market and local homes for sale, visit www.BetancourtRealEstateGroup.com or email us with a list of your search criteria.

Source: LATimes.com 

How Will Mortgage Interest Rates Effect Your Mortgage Payment

by Yvette Betancourt

Interest rates jumped one percent within a week in the month of June 2013.  Talking with the mortgage lenders I have done business in the past, told me that same thing -  the era of historical low interests are O-V-E-R!!!  The same week that interest rates jumped a whole percent, I read an article on my LinkedIn network that rates would continue to rise by the end of the year.  Some analyst dared to mention six percent interest rates.  

But what does all these numbers mean?  How will it effect buyers and sellers?  

It all comes down to numbers.  For sellers, the interest rate affects the refinancing of their home.

For buyers, it means a change in your purchase price range as price of homes continue to rise. 

Let's look at three Case Studies that will reflect a mortgage payment at three different interest rate:

Case Studio #1  at 3.5% rate

Conventional Loan

Purchase Price of Home: $450,000
10% downpayment of: $45,000
Loan amount for home: $405,000

Closing Costs in month of July

Fixed Cost: $7,893  
Pre-Paid Cost: $4,267
Total: $12,160 

Grand Total Due at Closing of Escrow (downpayment + closing costs): $57,160.00

Payment Info:

Principal and Interest: $1,818.63
Haz. Insurance: $131.25
M. Tax: 462.00
PMI: $178.88

PITI: $2,590.76

Case Studio #2  at 4.5% rate

Conventional Loan

Purchase Price of Home: $450,000

10% downpayment of: $45,000

Loan amount for home: $405,000

Closing Costs in the month of July

Fixed Cost: $7,893  

Pre-Paid Cost: $4,433

Total: $12,326

Grand Total Due at Closing of Escrow (downpayment + closing costs) : $57,326

Payment Info:

Principal and Interest: $2,052.08

Haz. Insurance: $131.25

M. Tax: $462.00

PMI: $178.88

PITI: $2,824.20

Case Studio #2  at 6% rate

Conventional Loan

Purchase Price of Home: $450,000

10% downpayment of: $45,000

Loan amount for home: $405,000

Closing Costs in the month of July

Fixed Cost: $7,893  

Pre-Paid Cost: $4,683

Total: $12,576

Grand Total Due at Closing of Escrow (downpayment + closing costs) : $57,576

Payment Info:

Principal and Interest: $2,428.18

Haz. Insurance: $131.25

M. Tax: $462.00

PMI: $178.88

PITI: $3,200.30

The increase of 1% in interest rates is $233.44 mortgage payment difference and $250.00 of closing cost difference. If interest rates rise to 6%, the difference is increase by $609.54 mortgage payment and $416 of closing cost difference. 

Is now a good time to enter the real estate market?

Contact me for more information about today's real estate market.