Worried about the ever-tormenting interest rates in Philadelphia as you plan on getting a new home or with your current home? It is important to investigate into the current state of interest rates in Philadelphia. If you never worried about what the Federal Reserve did as a homeowner, then it is time to start getting interested.
Interest rates are supposed to increase by June 2015 as according to CNN money. Dean Croushore, an economics professor at the University of Richmond and former Philadelphia Fed economist, says, “ People thinking of buying a house should act quickly to lock in today’s low rates”. To calculate how much interest rates you expect to pay click here.
According to the Philadelphia Tribune, a 30-year fixed mortgage has its interest rate at 3.8% compared to a high 4.3% last year. Are you excited now, that after all interest rates in Philadelphia are not as bad? It is indeed the right time to swoop in to buy that dream home in Philadelphia. Even if you don’t live in Philadelphia, it is considered the 5th best city to purchase property.
Right now is the best time to buy a home especially considering how low the interest rates are compared to last year. The federal government intends to raise interest rates soon due to the improvement in the economy. Interest rates are likely to change when changes occur in Fed policy, inflation or crises in domestic and international financial markets. It is, therefore, ideal to take advantage now to tap into the interest rates in Philadelphia.
Fixed or Adjustable Interest Rates, What Fits You Best?
A fixed interest rate charges you a set rate that doesn’t change throughout the entirety of the loan. Having a fixed interest rate is useful when you have a budget and want to maintain a certain payment every month. The great benefit you have here with a set interest rate is not worrying about sudden increases in monthly mortgage payments especially if interest rates increase. Remember, that a 30-year mortgage offers the lowest monthly payment however you will suffer paying higher interest rates because of the period of years. Plug in the numbers here to figure out your fixed interest rate.
Adjustable Interest Rates
As it suggests, your adjustable interest rates vary. The interest rate is set below the market rate then begins to rise as time flies. Before choosing an adjustable interest rate mortgage, you must consider the following:
Adjustment Frequency – which means the amount of time between interest-rate adjustments like monthly or yearly.
Adjustment Indexes – interest rates are aligned with a specific index like interest rates on CDs or Treasury Bills.
Ceiling – This will be the highest interest rate that the adjustable rate will be allowed to reach during the life of the loan.
The reasons why adjustable interest rates are inviting are because they offer low initial payments, which give you the opportunity to qualify for a larger loan. This gives you, the borrower, the liberation to enjoy lower interest rates without having to refinance. You can calculate your adjustable interest rate here.
Now the choice is yours, what will you choose, a fixed interest rate or an adjustable interest rate? You have to factor in what you can afford, in the long run. You have to measure your income, savings and spending habits to help you determine what interest rates you can afford in Philadelphia.
Have this mind that, Philadelphia is one of the most affordable cities to live in due to the vast ranges of high and low mortgages. You can find houses going for as low as $25,000 while others $300,000. Philadelphia, therefore, gives you more options for what you truly want and can afford when it comes to interest rates.