Save 15% on Your Next Purchase

Real Estate Agent with Keller Williams Realty

If you were eyeing a fairly priced condo at $400,000 and over a couple months it dropped 15% to $340,000, would you jump on it? If you were a serious buyer, you most likely would.

Well, that is happening with mortgage rates. Too often, buyers focus on just the list price and don't take it a step further to look at the monthly payment. Just a couple months ago, 30 year fixed rate mortgage were at 6.5%, which historically is still a good rate. Today, I got a couple rate sheets from some of my lenders quoting a 5% interest rate for a 30 year fixed loan. What contributed to the low rates? The announcement by the Federal Reserve on 11/25/08 to directly purchase $500 Billion in mortgage back securities.

So, let's look at some numbers.

    Loan Amount  
Int Rate $400,000 $500,000 $600,000
5.0% $2,147 $2,684 $3,221
5.5% $2,271 $2,839 $3,407
6.0% $2,398 $2,998 $3,597
6.5% $2,528 $3,160 $3,792


For a $400,000 loan at an interest rate of 6.5%, the monthly mortgage payment would be $2,528. Taking a 15% discount, the monthly payment drops to $2,149, almost equal to the payment at 5%.

That is a monthly saving of



a yearly saving of



and a total saving of



over the 30 year loan term!

For a personal consultation to see if now is the right time for you to buy, contact me anytime.



Comments (6)

Yvette Gardner
Keller Williams Realty, Spartanburg, SC - Spartanburg, SC

Welcome to the Active Rain community. This is a great site with lots of information.  Have fun with it and hope to see more of your blogs soon!  We have a team of three outstanding full time agents to assist your buyers and sellers in Spartanburg/Greenville, SC.  Let us know if we can ever help. Again, welcome to AR!!

Dec 13, 2008 12:10 AM
Sergio Rebollo Jr.
Real Estate TeamMates - Miami, FL

Rick....Welcome to ActiveRain.  This is a great community to network with others as well a great place to learn from other's experiences and knowledge.  I've enjoyed it; I hope you enjoy it as well.  Congrats on your first post.

Sergio Rebollo Jr.
Exit Prime Realty
Coral Gables, FL  33134

Miami Short Sale Specialist - Profile

Dec 13, 2008 05:19 AM
Keith Elliott Jr
KEIRE Realty Group - Manassas, VA
Principal Broker/Owner

Hello Rick,

Welcome to Active Rain and congrats on your first post! The opportunities to learn and network are incredible here. Best of luck to you!


Dec 13, 2008 11:53 AM
Vicente A. Martinez
Prudential Douglas Elliman Licensed Real Estate Salesperson - Woodhaven, NY
Realtor, Brooklyn - Long Island - Queens Homes

Hi Rick and welcome to active|rain.

Breaking it down always seems to make a lot more sense with the majority of people looking to buy. This should nudge them in the right direction. Enjoy AR!

There are thousands of tips, tools, and tricks of the trade here. Be sure to check them out. Best of luck and see you around.

Dec 13, 2008 06:39 PM
Todd Clark
eXp Realty LLC - Tigard, OR
Principle Broker Oregon


The best part about this is the buyers can have both right now, if they act fast. I have a feeling interest rates won't stay this low for much more than six months and if we have a six month to a year stay on foreclosures, prices could actually rise.

Welcome to the rain and thanks for the insight for buyers!

Dec 14, 2008 01:17 AM
Everard Korthals
---Preferred Lifestyle Advisors--- - Lancaster, PA
Mountain Realty

Welcome to Active Rain. This is a great place to learn and share with others. IF ever you were to have any questions then feel free to contact us and we'll try to help. Please take a look at our blog for links to valuable information in our sidebar that you can use to navigate this extensive network. Subscribing to our blog is also a great way to read our blog straight from your home pages. We also suggest taking a look at the Active Rain Wikipedia group for resources that may be valuable to you. We hope you have a great day in the Rain! All The Best-

Sincerely, Active Castellum

Dec 15, 2008 09:14 PM