Mortgage interest rates are currently quite low. Just about everywhere you look, there are news articles that state, “Now is a great time to buy a home or refinance your current mortgage!” While it’s absolutely true that now is a great time to lock in a fantastic mortgage interest rate, many current and prospective home owners do not realize the specific reasons that a low mortgage interest rate is so significant.
Following are some of the most important ways that a low mortgage interest rate can directly benefit you :
Your monthly payment can be significantly lower with a low interest rate mortgage. If you are currently borrowing at a rate of 5, 6 or 7 percent, refinancing into a mortgage with an interest rate at 4 percent or lower can result in a huge monthly savings. But not only might your monthly savings be significant… just think about how much money you will save over the duration of the entire term of the loan!
You won’t be sending as much of your hard-earned money to your lender – EVER! When you are locked into a low interest mortgage, you can rest assured that your interest rate will never rise – as long as you are in a fixed-rate mortgage and do not refinance your loan. Of course, if you either refinance or sell your house and have to open a new mortgage at some point down the line, you will be required to accept the mortgage interest rate that is available at that time.
If you are required to make lower monthly mortgage payments because your interest rate is low, you may be able to afford a more expensive house. If you have your eye on a specific house, but it is just outside of your price range, you might find that a low interest rate mortgage will make the monthly payment requirement on that house affordable. It’s all about the math, and your mortgage broker can provide you with monthly mortgage payment estimates based on various proposed mortgage interest rates.
It’s important to remember that low mortgage interest rates on fixed-rate mortgages will not be available forever. If you are thinking about purchasing a home or you are currently have a mortgage with an interest rate higher than 4 or 5 percent, now is the time to find out more about today’s low interest rate mortgage options. You may be surprised at how much money you can save each month with a low interest rate mortgage.