May 12th, 2017 5:10 AM by Jackie A. Graves, President
afford to buy a house? As Americans watch home prices rise while simultaneously
experiencing little to no increase in their paychecks recently, it's a question
that's become more difficult to answer — especially because the data differs
However, there is one factor that's consistent for everyone
regardless of location: mortgage
rates, and they have major implications on whether you can
afford to buy. Regardless of where you live in the country, there is very
little difference offered for the conventional 30–year fixed–rate mortgage,
which is by far the most popular mortgage product on the market for the majority
wasn't always the case, but it is a big benefit companies like Freddie Mac and
the secondary mortgage market make possible today. We help keep long–term
fixed–rate mortgages lower, and help keep them uniform across the country.
The 30–year fixed mortgage rate
averaged 4.05% in April, the
lowest average of any month so far this year, and very
close to today's rate. If you take out a $200,000 mortgage at this rate to buy
that home you've had your eye on, you'll pay $768 (assuming 20% down payment)
in principal and interest payments each month.
1971, when Freddie Mac began tracking mortgage rates, they have ranged from a
high of 18.63% in October of 1981 to a low of 3.31% in November of 2012.
Looking at the all–time highs and lows compared to more recent history offers a
good perspective on how your payments on the same $200,000 mortgage would
change as mortgage rates change.
the past few years, we've enjoyed a long run of historically low mortgage
rates. While no one expects them to change dramatically overnight, they are
expected to head up. Most experts agree that mortgage rates will drift up in
the coming months to end the year just below 4.5%.
a home is a big investment — what you can afford depends on many factors, but
especially the cost of the house, your income and your mortgage rate.
For more information and tools on
buying a home and homeownership, visit Ready to Buy.
Continue following the Spring Homebuying
Season Blog Series and visit My Home for the full run down on all things
of FreddieMac - To view the original article click here