Long-term mortgage rates have dropped to new record lows several times this year, most recently last week when they fell to 2.80%
A year ago, rates were almost 100 basis points higher, so UrbanTurf is taking its semi-regular look to see how the much lower rates are impacting mortgage payments.
We took a home with a $800,000 purchase price and assumed the buyer has excellent credit. Using the current rates and rates from last year, we examined how monthly mortgage payments changed. In each case, we assumed the buyer put down a 20 percent down payment. Note that these include principal and interest, but not the cost of insurance or taxes.
Here are the two scenarios:
October 2019: The average mortgage rate was 3.75 percent.
Monthly mortgage payment: $2,964
Total outlay on mortgage (monthly payment x 360 months): $1,067,018
October 2020: The average mortgage rate is 2.80 percent.
Monthly mortgage payment: $2,629
Total outlay on mortgage (monthly payment x 360 months): $946,702
So, the difference between a rate of 3.75 percent and 2.80 percent is about $330 a month or $120,316 over the life of the loan.
This article originally published at https://dc.urbanturf.com/articles/blog/330-a-month-the-difference-a-year-makes-in-interest-rates/17455.
Most Popular... This Week • Last 30 Days • Ever
This week's Best New Listings includes an expansive three-building property in Maryla... read »
UrbanTurf created Pipeline, a searchable database of multifamily projects that are un... read »
As we head towards the end of the year, UrbanTurf is wrapping up its coverage of larg... read »
Prices in Wesley Heights, a DC neighborhood to the south of Spring Valley bordered by... read »
Today, UrbanTurf takes a look at the distinct differences between these two popular f... read »
A new report out this week found that homes in the DC region are selling nearly a wee... read »
When Amazon announced in 2018 that it would be opening a second headquarters in Virgi... read »
A revised plan is on the boards for a group of five townhouses in the middle of China... read »
The proposed district would encompass the neighborhood's commercial strip along Conne... read »
WTOP is reporting that The Heights, an eight-stall food hall that is taking over the ... read »
With this weekend's DC houseboat tour a day away, UrbanTurf thought it only fitting t... read »
President Obama travels to Denver this morning to sign the stimulus bill that has bee... read »
In this week's installment of Ask An Agent, a reader wonders if there is a rule for h... read »
As The Wharf prepares to begin construction, DC's houseboat community heads to its ne... read »
In this week's installment of Ask An Agent, a reader asks a fairly common question th... read »
DC Real Estate Guides
Short guides to navigating the DC-area real estate market
We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Start browsing below!
Intro guides for first-time home buyers
Awesome and unusual real estate from across the DC Metro