Buying power and the refi.
Let’s say that two years ago you wanted to spend $1,000,000 on a two bedroom condo in New York City.
Your monthly taxes and common charges were $1920 per month.
You put $300,000 down and got a $700,000 mortgage.
The mortgage rate would have been about 5.191% for a 30 year fixed rate mortgage and your monthly payments would have $3839.89 and your total monthly expenses for your condo would have been $5759.39.
Now let’s buy that same apartment today.
The price is still $1,000,000
Your monthly taxes and common charges went up a bit and are now $2100 per month.
You still put down $300,000 and still got a $700,000 mortgage.
The mortgage rate would be 4% for a 30 year fixed rate mortgage and your monthly payments would be $3341.91 and your total monthly expenses for your condo would be $5441.91.
That is a savings of $317.48 per month, $3809.76 over the year and $114,292.80 savings over the life of the 30 year mortgage.
So my question to you, is, “What are you waiting for to refi your current loan?
Or your buying power just went up because of the lower rates from two years ago….Time to jump in!