Most Americans have taken a hit to the wallet as a result of the coronavirus pandemic’s impact on the economy. Global poverty could increase by as much as 1.5 percent, and global trade continues to decline. North America is expected to suffer significant losses due to lower trade, according to the United Nations Industrial Development Organization.
The U.S. housing market is also feeling the effects of COVID-19. Interest rates are at a record low, meaning that despite a struggling economy, now might be the best time to score a record-low mortgage rate. Taking advantage of a low rate could potentially save you thousands of dollars. If you want to get the best deal possible, you should take the time to review multiple lenders. Shopping around is a vital step that many homebuyers skip. Using an online tool like Credible to compare rates is an easy (and free) way to potentially save a lot of money.
Shopping around could save you thousands of dollars
One percent seems like such a small number, but it can add up over time. Let’s look at a quick example.
- Lender A offers you a $400,000 fixed-rate home loan for 30 years at a 4 percent interest rate. At that interest rate, your monthly mortgage payment would be $1,909.66. Your total home loan would cost $687,478 over 30 years, and you’ll have paid $287,478.03 in interest.
- Lender B offers you a $400,000 fixed-rate home loan for 30 years at a 4 percent interest rate. At that interest rate, your monthly mortgage payment would be $1,686.42. Your total home loan would cost $607,109.81 over 30 years, and you will have paid $207,109.81 in interest.
A simple one percent difference on your interest rate could save you more than $80,000 over the life of your home loan. That’s a lot of vacations or a lot of money you could invest in retirement. Don’t just accept the first-rate offered by a single lender.
If you’re ready to purchase a new home, taking advantage of lower interest rates (even if it’s just one percent) could save you thousands of dollars. With Credible’s easy online tool, you can compare rates from multiple lenders almost instantly — without any impact on your credit. Check out today’s rates below.