The power of the interest rate

When purchasing such a large investment as real estate it’s easy to get wrapped up in the negotiations. One part of the negotiation that has nothing to do with the asking price or the price the buyer is willing to pay is the interest rate. Yet, for the buyer it is extremely important to be aware of the rate and know that the rate can drastically change in a day (which may not be in your favor!!) Take for instance this graph shows how quickly what once was with one rate can quickly become unaffordable. It happens again and again that buyers are busy negotiating down to the last dollar only to realize in the last few days the interest rate went up and those dollars didn’t even matter. If you’re a buyer just keep this in mind. We can’t predict what interest rates will do, but it’s still good to keep in constant touch with your lender when negotiating a deal.