Attention Home Buyers: Your House May Cost More | Interest Rate Hike

Attention Home Buyers: Your House May Cost More | Interest Rate Hike

Shopping for a new home is an exciting process, especially if it’s your first time.

You’re checking out new neighborhoods, thinking about redecorating and looking forward to your first housewarming party. Unfortunately, though, your dream house probably just got more expensive, thanks to the interest rate hike by the Federal Reserve.

That means if you haven’t locked in your mortgage rate yet, the cost of your house over the life of the loan will go up with increases in your mortgage rate. For example, on a $400,000 loan at 4%, if your rate goes up a quarter percent, it will cost you over than $20,000 more in interest over the loan’s duration. And that’s if rates hold where they are. With more hikes widely anticipated, your total interest will go up even more. On that same loan, if rates were to increase a full percentage point, as many experts believe will happen, and your mortgage followed suit, you would end up paying about $85,000 more in interest by the time you owned your home free and clear.

But did you know that you have a weapon to fight back and keep more of your money to use toward retirement, your children’s education or other financial goals?

Biweekly loan payments can potentially save you thousands of dollars in interest and have the added benefit of helping you get out of debt a whole lot faster, even after the interest rate hike. The secret lies in just one simple change to how you make your payments. By splitting your regular monthly payment in half and paying that amount every two weeks, you give yourself the advantage over your lender. But it’s critical to do this consistently and have the additional funds earmarked for paying down principal. And that’s where AutoPayPlus can help.

On that $400,000 mortgage at 4.25%, you could save around $50,000 in interest with biweekly payments through AutoPayPlus— that covers the increased cost of the rate hike with enough left over to buy a big screen TV for that new house, some new furniture and take an awesome vacation!

AutoPayPlus will do all the legwork for you. We’ll set up an automatic payment plan, coordinate with your lender and make sure the extra funds go toward principal so you can start saving and getting out of debt faster. You’re still in charge. You can stop or suspend at any time and track your progress through our convenient online member portal.

We’re on target to help save American families $29 million in interest, and we want to help you get ahead. Call one of our professional loan consultants today to find out exactly how much you can save on your new home.

Source

http://www.usatoday.com/story/money/2015/12/14/fed-rate-hike-impact/77300960/

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