WHAT DOES THE FED INTEREST RATE HIKE MEAN FOR YOUR MORTGAGE?

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With the Federal Reserve finally expected to hike interest rates, your first thought might be what that means for mortgages.

You’re right to be concerned—for millions of Americans, taking on a mortgage may be the largest financial decision they ever make. If and when the Fed makes its move, homeowners will face higher rates, affecting both the cost of borrowing and the price of homes across the country. But don’t get bent out of shape: the impending increase doesn’t mean you need to rush to buy or sell a house.

Today, borrowers taking out a 30-year mortgage, by far the most popular option, pay an average of 3.9%, near record lows. At that rate, the monthly payment on a $200,000 mortgage would be $944. (To see what you would pay on a different amount, try our Mortgage calculator). For comparison, at 6%—where 30-year mortgages hovered before the Fed started cutting interest rates in 2007—that same loan would cost $1,200 a month.

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Keith Kaplan

CalBRE #01933707
Sothebys International Realty
9255 Sunset Blvd.
West Hollywood, CA   90069

keith.kaplan@sothebyshomes.com

310-646-7791

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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