Financial Update by Maurice Soussé

Mortgage rates increased a touch this week as MBS (Mortgage Backed Securities) are selling at higher yields to attract buyers. As the stock market increases, investors leave the bond market which forces sellers to push rates higher to attract buyers. This pushes mortgage rates higher as well.

Let’s look again at the difference in payments for a 1/2% move in rate.

$400,000 Loan Amount
30 Year Fixed
3.5% Rate (3.62 APR)
$1796 Payment

$400,000 Loan Amount
30 Year Fixed
4% Rate (4.13 APR)
$1909 Payment

The savings is $113 per month for the same loan amount. This in itself is a great reason for buyers to get into a home before rates rise (which they surely will).

Meanwhile, rates are super low so take advantage of the great opportunities that are upon us.

I like the quote by Steven Woodhull who said “You’ve got a lot of choices. If getting out of bed in the morning is a chore and you’re not smiling on a regular basis, try another choice.”

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