Now is still a good time to buy a home, or why now may not be a good time to wait

Potential home buyers should consider the possibility of rising interest rates when thinking about the true cost of buying a home. Keep in mind that the true cost is not determined by price alone, but by price and mortgage rate.

As it looks right now, the longer a buyer waits to buy, the higher their mortgage payment will be, if the mortgage rates continue to increase as currently projected. (These projections come from Fannie Mae, Freddie Mac, the National Association of Realtors and the Mortgage Bankers Association).

In Money Magazines latest issue, they agreed with this and they also warned their readership of the same increase if they waited to buy a home.

Here is what they said:

"BE MINDFUL OF RATES. The average interest rate on a 30-year fixed loan is predicted to climb from the current 4.4% to 5.3% by the 2015 spring buying season, according to Freddie Mac. For a $250,000 loan, that means that a borrower who waits would pay $136 more per month and an additional $49,090 in interest over the life of the loan. Will you need a big loan? Better to act soon before rates tick up."

Also, the monthly increase addressed in the article did not take into consideration that prices are also projected to increase over the next year. Take a quick look at the provided graph to see what the additional cost would be if prices rise by the projected 4.5% and interest rates go to 5.3%.



If you’re thinking about buying home in Carroll County, you can search all the homes listed for sale online at www.RobDRealEstate.com .