We all know that lower mortgage interest rates mean lower monthly payments. But how much lower, and what is the impact of that over the life of the loan? You can use a mortgage calculator to demonstrate the savings to your clients, or you can use this nifty infographic that visualizes exactly what a 1% interest rate difference means to your client.
“Although the difference in monthly payment between a 4.5 percent interest rate and a 5.5 percent interest is not dramatic, your savings in interest paid over the life of the loan is significant,” said Erin Lantz, director of Zillow Mortgage Marketplace. “Mortgage rates will likely rise to 5 percent by the end of 2014 due to an improving economy and policy changes by the Federal Reserve. By buying a house while interest rates are still incredibly low, you could end up saving more than $52,000 over the course of 30 years.”