taking advantage of decreasing interest rates |
We are starting to see the impact of the Federal Reserve’s first cut of its federal funds rate in more than four years last month. It cut the rate by half a percentage point.
Calculating your monthly payment
What does a 6.5 percent interest rate look like compared to a 6.25 percent interest rate when it comes to your monthly mortgage payment? We looked at a hypothetical situation using CHFA’s mortgage calculators.
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Loan Amount: $425,000 | Loan Amount: $425,000 | Loan Term (Years): 30 | Loan Term (Years): 30 | Interest Rate: 6.5 | Interest Rate: 6.25 | Principal and Interest: $2,686.29 monthly | Principal and Interest: $2,616.80 monthly | | |
As illustrated, a small difference in interest rate could save approximately $70 a month on your principal and interest payment, or more than $833 a year.
Choosing your mortgage lender
When it comes to your mortgage lender, there is more to consider than choosing the one who offers you the best rates. It is important to shop around, because you want to work with a lender who offers expertise and will help guide you through the process. We recommend you interview at least three different mortgage lenders.
Sources for finding a lender include:
- Your current bank, credit union, or other financial institution
- Your real estate agent
- Referrals from friends and family
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Online, e.g., www.chfainfo.com
- Nonprofit housing agencies that provide down payment assistance programs
There are several questions to consider asking when you are interviewing mortgage lenders. Just calling and asking, “what are your rates?” will likely not give you the full picture.
Helpful questions to ask lenders may include:
- What type of loan programs do you offer?
- Can you do FHA, VA, USDA-RD, and conventional loans?
- How long have you been in the mortgage business?
- Can you supply referrals/reviews from past customers?
- Do you work with organizations that provide down payment assistance programs?
- What are the loan and other associated costs? (get a sample itemization)
Your lender is working for you, so ask as many questions as you need to feel secure. Additionally, before you move forward with any mortgage lender, you should verify that they are licensed.
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chfa supports nonprofit project i see you as gala sponsor |
CHFA is proud to support Project I See You’s Annual Gala celebrating 50 Years of Ownership on November 15, 2024, with a $5,000 sponsorship. Project I See You is a 501(c)3 nonprofit organization that exists to see women take ownership of their lives. The nonprofit reaches women across diverse cultural, racial, and socioeconomic barriers. Its Shared Power Initiative empowers women throughout the entire process of homeownership, and empowers women business owners with financial, marketing, and leadership expertise.
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Free CHFA webinar
Attend a free, one-hour webinar to learn the steps to homeownership and about CHFA’s homeownership programs.
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Online resources
Learn more about and prepare for homeownership:
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With respect to its programs, services, activities, and employment practices, Colorado Housing and Finance Authority prohibits unlawful discrimination against applicants or employees on the basis of age 40 years and over, race, sex, sexual orientation, gender identity, gender expression, color, religion, national origin, disability, military status, genetic information, marital status or any other status protected by applicable federal, state or local law. Requests for reasonable accommodation, the provision of auxiliary aids, or any complaints alleging violation of this nondiscrimination policy should be directed to the Nondiscrimination Coordinator, 1.800.877.2432, TDD/TTY 800.659.2656, CHFA, 1981 Blake Street, Denver, Colorado 80202-1272, available weekdays 8:00am to 5:00pm. | |
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