One of the biggest mistakes homebuyers make is focusing too much on the interest rate. While the rate is important, it’s just one piece of the puzzle. Your total monthly payment is what truly determines how comfortably you can afford a home.
The interest rate affects your mortgage payment, but other factors play just as big of a role, including:
These can vary significantly based on location and add hundreds of dollars to your monthly payment.
Your lender requires coverage, and costs fluctuate based on home value, location, and risk factors.
If your down payment is less than 20%, PMI may be required, increasing your monthly expense.
If you’re buying in a community with a homeowners association, factor in these fees, which can range from modest to substantial.
Many buyers are holding off, hoping for interest rates to drop. But waiting could cost you more in the long run. Home prices will likely continue to rise, as demand remains strong. Even if rates decrease in the future, there’s no guarantee that home prices will remain steady—higher prices could offset any savings from a lower rate. Additionally, when rates drop, competition will increase, leading to bidding wars and fewer negotiating opportunities. Buying now allows you to start building equity sooner, and if rates improve later, refinancing is always an option.
Rather than fixating on securing the lowest possible interest rate, focus on what your total monthly obligation will be. This gives you a clearer picture of your financial commitment and ensures you can comfortably afford your home - not just today, but long-term.
If you’re shopping for a home, don’t just chase the lowest rate. Schedule a no-obligation consultation and we will help you understand the full picture of your costs, the process, pros and cons. A slightly higher interest rate with lower property taxes and insurance could actually result in a lower total payment than a lower rate with high associated costs.
Buying a home is a big decision, and you don’t have to navigate it alone. We’re here to guide you through every step, ensuring you make informed choices that align with your budget and goals. Reach out today - we’re excited to help you on your homebuying journey!
Laura H. & Christopher M.
We were initially denied by a lender and when our possibilities were limited, Mr. Krauss helped us achieve our dream of getting a model home. My husband is a Veteran and he informed us of discounts and grants that we were not aware of.
Nicholas M.
I was well informed every step of the way never left me guessing all ways their when I had a question all ways very professional and respectful I had a pleasant experience.
Bonnie M.
Consistent communication and being able to trust the process. Richard closed my purchase after it was denied by another lender due to my low credit.
Natalie D.H.
Richard's quick response to any issue or questions I may have had. And his expertise in getting it all handled quickly. I am Self Employed, he was able to close the loan before the due date.
Lorine C.J.
Richard has successfully completed several refi’s for us which is why we brought our latest refi need to him. Our communication was excellent and our current refi went smoothly.
Nadine W.
Richard was able to close my VA Purchase ahead of time with a low credit score of 520. His expertise overcame every hurdle within the process.
Bryan P.
Richard took the time to help a homeless disabled Veteran into a new home. No one would help except for him. He explained how to qualify and executed my purchase ahead of schedule with the builder!
Roberto R.
I was in an active Chapter 13 Bankruptcy, Richard was able to contact the court for approval and assist with my new purchase. He then provided me with the SAH Grant information for disabled Veterans and helped with my disabilities in the new home.
Greg S.
Richard is my old high school friend. We both served in the military, and he was able to explain how I can purchase with a lower credit score. My family has a beautiful home and we are able to start our next chapter!
David S.
Richard executed a Cash Out refi to purchase an investment property. The loan was approved withing 5 Days. Extremely quick turn around and awesome communication. He always answered my questions.
