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Home Buying Tips | Low Mortgage Rates

October 17, 2010 By Doug Francis

The Innis House, Fredericksburg VA
Image by DougFrancis via Flickr

It seems like every week there is an announcement that home mortgage rates are at an “all-time low”, but this weekly headline is starting to get a little stale for most home buyers who are locking-in the mortgages as late as possible before going to closing. The “rate float option” gives home buyers the option of risking today’s low rate with the expectation that they will lock-in at a lower rate in the future.

This isn’t about mortgage rates

Well that is almost true, because it is important to point out that we are looking at financing a long-term “investment”. Your mortgage is a debt and the interest that you pay is an annual tax deduction.

If you are looking to buy a home then you really need to examine how long you will live there, or what your life will look like in five or ten years? Yes, this is time for long-term planning, to think big, and to consider a house that you will still fit in ten years from now. With rates this low, you are able to afford a better house than you would have been able to buy two years ago

“… own the best house you can afford” – Life’s Little Instruction Book

You are probably a wiz at this by now, but let’s assume you are getting a mortgage for $417,000 on a cute Vienna VA house and hope to lock in a 30-year rate, do you know how much the interest payment will be every month?

Interest Rate x Loan Amount = Annual interest ÷ 12 = Your Monthly Interest

4% x $417,000 = $16,680 ÷ 12 = $1,390 a month in interest

4.5% x $417,000 = $18,765 ÷ 12 = $1,563 a month in interest

5% x $417,000 = $20,850 ÷ 12 = $1,737 a month in interest

6% x $417,000 = $25,020 ÷ 12 = $2,085 a month in interest

What I am suggesting here is that you buy a home for a life that is bigger than your life is today because long-term money is so cheap. Yes, I am suggesting skipping that starter home. These low rates should really make you consider buying as big a home as you can afford keeping in mind your future needs and quality of life.

You may never move again

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Related articles
  • You: Mortgage rates fall to another record low (washingtonpost.com)
  • UPDATE 1-U.S. mortgage rates at new record lows-Freddie Mac (reuters.com)
  • U.S. 30-year mortgage rates fell in week – Zillow (reuters.com)
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Filed Under: Blog, Featured Posts, Home Buyer Tips Tagged With: buyer agent, doug francis, Home Buyer Tips, real estate, Vienna Virginia

About Doug Francis

A Realtor specializing in unique and new homes around Vienna, Virginia, Doug started writing a first-hand blog about his everyday real estate experiences a decade ago. In depth, helpful and fun has always been the objective. Outside real estate, he was profiled in a commercial for Verisign's "Where the World Clicks" campaign, and was quoted in Money Magazine's Best Places to Live article on Vienna. He's a Boston University graduate who feels morning coffee is non-negotiable.

Helping my clients add value to their home has always been important to me. My step-by-step recommendations are intended to increase market appeal, return more then invested, and help net more when selling.

Beyond just sellers, I have helped many new homeowners make smart design decisions when remodeling. We gutted our house and totally remodeled it, and I pass that experience along because living in a nice house is simply better.

My background… I’ve been an active licensed agent in Virginia for 25 years, work at TTR Sotheby’s International Realty in McLean, and sell homes in all price ranges. I donate to the Town of Vienna tree replacement fund, participate in a neighborhood citizens association, and try my best to stay in shape.

Questions? Email doug@dougfrancis.com or call me at (703) 304-6827 to discuss your plans. Cheers!

Filmed in Vienna and McLean

https://youtu.be/ClqEIV1zoQg
Viva Vienna Vienna Idol event on the Town Green sponsored by Caffe Amouri

The Vienna Town Green

The Town Green in Vienna, Virginia is located where Maple Avenue intersects the W&OD Bike Trail and Mill Street. The Town

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About Doug Francis

I am a Realtor with TTR Sotheby's International Realty® just outside Washington D.C. in Northern Virginia. I have been a full-time Realtor licensed in Virginia since 1991, and cover a big territory specializing in the Vienna real estate market and custom homes for sale.

I have unique knowledge of digital real estate marketing, and my marketing starts here. My clients have been attracted to my results-oriented strategy for years, and I am accepting new clients for Fall 2022 right now.

Thanks for reading, and feel free to contact me at 703-304-6827 or email me at doug@dougfrancis.com anytime!

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