How Mortgage Rates Impact Your Payment📊🔍💲

Let’s unlock the secrets of how mortgage rates impact your payment. Now is the time to track and create a home purchasing power plan in Metro Detroit.  

How Mortgage Rates Impact your Payments | Team Tag It Sold for Metro Detroit

The Best Way to Keep Track of Mortgage Rate Trends

If you’re considering purchasing a home, mortgage rates are likely a significant factor in your planning. These rates determine your potential monthly payments, so getting a handle on them is essential for your financial planning. With so much fluctuating information in the news, it can feel overwhelming to keep track. Here’s a clear guide to what you really need to know.

What’s Up with Mortgage Rates? 

Mortgage rates have been unpredictable recently, showing fluctuations that might leave you wondering about the cause. Several factors influence these changes, including the overall economy, employment rates, inflation, and decisions made by the Federal Reserve. As Odeta Kushi, Deputy Chief Economist at First American, notes:

 “Factors like ongoing inflation slowdown, a cooling economy, and geopolitical uncertainties can drive mortgage rates down. Conversely, data indicating potential inflation risks could push rates higher.”

Understanding Mortgage Rates Impact and Home Prices

Let’s dive into how mortgage rates impact on your payment along with home prices.  When mortgage rates go up, home prices usually don’t climb as fast. This can cause buyers to wait it out, leading to a lot of pent-up demand. If the rates start to fall, more buyers will enter the market, causing an increase in demand. We still have a home supply shortage, and we could see a repeat in the “Unicorn Years” when prices took off due to multiple offers from buyers.

Know Your Options

 To make smart choices, grab your calculator, and let’s look at your options. Would you rather deal with higher mortgage rates for a while, hoping to refinance at a lower rate later and get a better deal on a house? Or would you rather wait for lower rates but possibly pay more for a home? Both will affect your monthly payment. Understanding these parts can help you determine the best time to buy or sell, especially with concerns about how a recession could shake up our local market in Metro Detroit.

Metro Detroit Home Prices and Real Estate Trends Direct from MLS | Team Tag It Sold
Metro Detroit Home Prices and Trends by City

Take control of your home-buying or home-selling journey with direct access to our Multiple Listing Service (MLS) through our unique bridge access feature. Dive into detailed, real-time graphs and trends, and explore home prices across different cities and price ranges at your own pace. Curious about recent selling prices? You’ve got access to up-to-date sold data, too. Skip the headlines and get the facts straight from the source. And if you’re wondering what your home is currently worth in today’s market,  Click Here for an instant report. Start exploring now and make informed decisions with ease!

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Mortgage Rates - What's Driving the Change

If you’re on the journey to buying a home in Metro Detroit, you’ve likely been monitoring Today’s Mortgage Rates. Most lenders will start with the day-before rate numbers for quotes in the a.m. Then, update rates about mid-day. You’ll know where they are heading by monitoring the 10-year treasury yield. Remember, I track baseline mortgage rates; the mortgage rate doesn’t include points lenders charge to buy down the rate, your credit score, or your down payment. Your mortgage rate will be lower or higher depending on the above conditions. Rates have been everywhere recently, hitting rock bottom and soaring to new highs. Here is where we will review what’s behind those dramatic changes. Let’s take a look at some key elements that play a significant role. Updated mortgage rates are released between noon and 2 pm. 

Scroll Through Home Loan Amounts and Mortgage Rates

Now that you know how to track home prices and mortgage rates, you need to work on your monthly payment budget. I recommend that when you are shopping for a lender, you also ask how much it would cost to refinance and work that figure into your overall budget. Once you determine your monthly payment for principal and Interest only, you must add your Payment Mortgage Insurance (PMI if you put down less than 20%), property taxes, and homeowner insurance.

Calculating Your Taxes

This is the biggie: your property taxes in Metro Detroit. Don’t use the posted taxes because your taxes will increase based on what you paid for the house. Tax payments are calculated on June 1 and November 1, so be prepared for your payment to go up. Contact the municipality and find out their mileage rates for different school districts. Take the home sale price and divide by 2 = X.  Next, take the millage rate, multiply by  X, and divide by 12; that will be your payment with the following tax rate.

Scroll Through The Buyer’s Purchasing

I’ve prepared several different chart scenario’s to help you determine your monthly payment base for principal and Interest only. Click the picture to enlarge. 

Bottom Line

Are you curious about the housing market’s current state in Metro Detroit and what it means for your home-buying plans? Let’s connect, and I can clarify current market conditions and help you understand what they mean for your situation.

This educational approach helps you stay informed and prepared. Before long, you’ll become a pro. To stay current, consider signing up for our newsletter. We’ll keep you updated on the latest news and trends. 

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Pam Sawyyer @ Metro Detroit Home Experts

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