Not sure if now is the time to buy? Continue reading to find out why it is!

Interest rates continue to trend at historical lows, increasing the affordability index of today's real estate market. These historic lows have offset the perceived impact of Fannie and Freddie dropping their limits in Marin County to $625,500. We used to deal with a gap in jumbo and conforming mortgage rates of at least .5%.  Whereas today, with the 30 year fixed interest rate 4.250% the difference can be as little as a .125% which translates to just $72.90 per month.

 

Alternatively, homeowners that are payment sensitive can look to a 5/1 adjustable rate loan or a 30 year fixed with a 10 year interest only period.  The 5/1 arm will have an interest rate around 2.875% and save $770.48 per month in payments.  The 30 year fix with 10 year interest only blends the conservative nature and security of the 30 year fixed with the flexibility to just pay interest during the first portion of the loan.  The savings will amount to $1273.56 in payments per month.

 

Here’s a quick snapshot of what estimated payments on a $1,000,000 loan would be today:

1) 5yr ARM - interest only at 2.875% = $2,395/month

2) 7yr ARM - principal and interest 3.125% = $4,283/month

3) 30yr Fixed - principal and interest 4.375% $4,992/month

 

As always, I am here if you have any questions regarding the current market or for more information regarding mortgage rates, please contact Adam Wise of MSP Loans:

 

Adam Wise
Home Mortgage Consultant
NMLSR ID 653875
Mortgage Services Professionals, LLC | 60 Belvedere Drive | Mill Valley, CA 94941
MAC M1048-031
Phone (415)380-2160| Cell (415)297-9473| Fax (877)869-9947
An Affiliate Of Wells Fargo Home Mortgage
adam.wise@msploan.com
www.msploan.com/adam-wise