If interest rates go up it could have a significant impact on your purchasing power and payment. Let's look at an example below.
$200,000 Loan amount - 30 year fixed mortgage:
| Interest Rate | Monthly Payment | Increase in Payment From One Rate to The Next | Increase From Current Rates |
| 3.5% | $895 per month | 0 | 0 |
| *4.5% | $1,013 per month | $118 (Roughly current rates 2018) | 0 |
| 5.5% | $1.135 per month | $122 | $122 |
| 6.5% | $1,264 per month | $129 | $251 |
| 7.5% | $1,398 per month | $134 | $385 |
| 8.5% | $1,537 per month | $139 | $524 |
...OR...
Look at it this way.
Here is how much home loan you get for the same payment:
| Loan Amount | Interest Rate | Monthly Payment | Purchasing Power Lost To Maintain The Same Payment |
| $200,000 | 3.5% | $895 per month | Zero |
| $178,000 | 4.5% | $897 per month | $22,000 |
| $159,000 | 5.5% | $897 per month | $41,000 |
| $142,000 | 6.5% | $897 per month | $58,000 |
| $128,000 | 7.5% | $895 per month | $72,000 |
| $117,000 | 8.5% | $899 per month | $83,000 |
We never thought it would go up but it has over the past year and a half and is expected to be raised twice more this year and 3 times early next year. Give us a call to get started on the loan process and we will refer you to the best mortgage loan officer in the business! We service the Albuquerque and Rio Rancho area.
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