How Mortgage Rate Changes Affect You 

Interest rates on 30-year fixed-rate mortgages have hovered between 6% and 7% this year. If you’re wondering whether to buy a home or not, it’s helpful to know exactly how a 1% or even 0.5% change in your mortgage rate will affect your purchasing power.

The table below shows the general relationship between mortgage interest rates and typical monthly mortgage payments.

Even a 0.5% change can have a big impact on your monthly payment. And since rates have been moving between 6% and 7% for a while now, you can see how it impacts your purchasing power as rates go down.

What This Means for You

You may be tempted to put your homebuying plans on hold in the hope that interest rates will drop. But it can be dangerous. No one knows exactly how interest rates will behave in the future, and it’s hard to time it in your favor. BrightMLS housing economist Lisa Sturtevant explains:

You may be tempted to put your homebuying plans on hold in the hope that interest rates will drop. But it can be dangerous. No one knows exactly how interest rates will behave in the future, and it’s hard to time it in your favour. BrightMLS housing economist Lisa Sturtevant explains:

That’s why it’s critical to lean on your expert real estate advisors to explore your mortgage options, understand what impacts mortgage rates, and plan your homebuying budget around today’s volatility. They’ll also be able to offer advice tailored to your specific situation and goals, so you have what you need to make an informed decision.