Do you know the power of 1%
How a 1% increase in interest rates can reduce your buying power
Let’s say you are prequalified right now for a loan amount of $200,000. The interest rate is 4% for a 30 year term. Your principal and interest payment is $954.83. With your other debts, this is the maximum monthly mortgage payment that you qualify for. Notice what happens if rates increase 1%…
Right now…Interest Rate: 4%Term: 30 yearsPrincipal & Interest: $954.83Loan Amount: $200,000
Time passes & rates increase… Interest Rate: 5%Term: 30 yearsPrincipal & Interest: $950.17Loan Amount: $177,000
$200,000 – $177,000 = $23,000
A 1% increase in the interest rate has impacted the loan amount you qualify for by $23,000. Crazy, right? Now think about this: What if rates increase by 2%, 3%, and so on…Apply with Legacy Lending today and keep ALL of your buying power.
Information provided by Heather Gilstrap of Legacy Mortgage