Thursday, July 7, 2011

The New Trend in Fixed Rate Mortgages...the 15 Year Loan

How would you like an extra $125,000?

Last week, interest rates dropped to their lowest point in 2011.  We saw fixed rates as low as 4.375% for 30 years, 4.25% for 20 years, and 3.75% for 15 years.  We also saw adjustable rates as low as 2.875%!  The current trend in fixed rate mortgages is to pay a little extra and get a 15 year loan instead of a 30 year.  What's the advantage?  Let's take a look:

If you have a 30 year mortgage of $200,000 at 5% interest, your payment would be $1,074 /mo (Principal & Interest only).  If you refinanced that to (or start off with) a 15 year mortgage at 3.75%, your payment would be $1,454 /mo (P&I).  For a difference of $380 /mo, you could pay your mortgage off in 15 years instead of 30 and build equity in your home much extra $21,593 in equity in just 3 years and $37,613 in 5 years.  Not only that, but by paying off the loan in 15 years instead of 30, you would save $125,000!!

Sound intriguing?  Give us a call or shoot us an email and we'll refer you to a Lender that will help you take advantage of today's low rates!!

No comments:

Post a Comment