Interest Rates at 50 Year Lows
You don’t need a tax credit with these rates. I am just blown away. Just as I think they can’t go lower they go lower. All of this is without the Fed buying mortgage-backed securities. Most thought rates would shoot up after the Fed stopped buying and not only did they not do that they went down.
Let’s look at how much an interest rate can affect a mortgage payment. On a loan amount of $200,000 the principle and interest payment for 30 years with a rate of 5.625% is $1151.31 and at 4.625% it is $1028.28 per month. That is a savings of $123.03 multiple that by 60 months (5 years) and you get a savings of $7381.86. There’s your tax credit. Take that over 30 years (360 months) and it is a savings of $44,291.15.
I don’t know but my thoughts are if you are looking to purchase or refinance now is the time. But then again I have been saying this with rates in the 5%’s so who am I.