The Federal Reserve raised its benchmark interest rate this week. Why should you care? Because lenders tend to follow suit with their mortgage rates. In general, a small increase in the Fed's rate doesn't affect lending rates in a big way, but even a small increase in mortgage rates can have an impact on you. And the Fed, along with announcing its increase, also indicated it may raise the rate again a few more times this year.
Let's look at a real-life example of what this could mean for a buyer in Denver. The average mortgage rate this month is around 4.3 percent, and the median home price in Denver is $449,000. (If you did a traditional 20-percent-down option, that's a loan of $359,000.) If the borrowing rate were to increase by even half a point in the next year, that would mean your monthly mortgage payment would increase by $107.
If you've been thinking about buying your dream home or investing in a rental property, it might be a good time to move forward. If you have any questions about the Denver market, reach out today and let's chat.