Up Down Up Down Up Down. Is It An Illusion

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June 20, 2015 by Jeff Lowen

Mortgage Rates.17393590_SA

We are completely oblivious to them unless we’re in the market for a new loan, refinancing, or in the industry. So when I saw that Freddie Mac released an article stating, “Mortgage Rates Improve After Last Week’s Spike,” I dove into the details a little further.

Here’s an example of your monthly payment from a $400,000, 30 year, fixed mortgage:

Last week’s “spike:” $1,918.90

This week’s drop: $1,909,66

This time last year: $1,949.07

5 years ago: $2,084.18

10 years ago: $2,291.27

15 years ago: $3,016.32

20 years ago: $2,816.06

Way back in 1980: $5,482.36 (Ouch!)

The moral of the story…

If you’re remotely thinking of buying a home and worried about what interest rates are doing so you can time it just right and miss out on the perfect property to save a few pennies each month…


According to a NAR study, folks are staying in their homes a little longer these days,and after 7-12 years, we’re all moving, anyway! Over the course of the past week’s spike, then subsequently the drop on the example above, over 7 years worth of mortgage payments, the difference is a whopping $776.16!!

And just to put it into perspective, if you’re a Starbucks aficionado, you’re blowing through about $5,500.00 in the same time! (According to Starbucks and Yahoo Finance)

Perhaps if you’re cutting it that close, the small rise and fall of mortgage interest rates… isn’t really the problem, huh? 🙂


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