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    Low Interest Rates have a Large Influence on Your Purchasing Power

    According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.92%, which is still near record lows in comparison to recent history!

    The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but impacts your purchasing power as well.

    Purchasing power is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford will decrease, if you plan to stay within a certain monthly housing budget.

    With each quarter of a percent increase in interest rate, the value of the home you can afford decreases by 2.5%.  Experts predict that mortgage rates will be closer to 5% by this time next year.

     

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