Mortgage rates have dropped to their lowest level in over a year and a half—great news for those who’ve been waiting for the right moment to buy a home.
A slight decrease in rates could improve your monthly payment on your next home, and the recent drop is more than just minor. According to Sam Khater, Chief Economist at Freddie Mac:
“Mortgage rates have fallen more than half a percent . . . and are at their lowest level since February 2023.”
To see the impact for yourself, examine the numbers closely. Here’s how the changes could affect your monthly payment.
The chart below compares the monthly payment (principal and interest) on a $400K home loan if you had bought a house in April (when mortgage rates were at their highest this year) versus what it could be if you buy now:
A drop from 7.5% a few months ago to the low 6s significantly affects your bottom line. Over this short period, the monthly payment on a $400K loan has decreased by over $370, resulting in hundreds of dollars in savings each month.
Key Takeaway
With recent mortgage rate declines, your purchasing power is now stronger than it has been in nearly two years. Contact a Benson & Mangold agent to discuss your options and how to take advantage of this opportunity you’ve been waiting for.
