The Cost of Waiting to Purchase Property - Get Off The Fence

Two friends purchase identical homes next door to each for the exact same price. Each home has a price of $200,000. The first friend purchases their home now while the interest rates are at their lowest levels in recorded history. The second friend decides to wait and see if the price of the home will decline further, fully expecting that it will from the advice of a favorite uncle.

Both homes sell for the exact same price of $200,000.

Two friends purchase identical homes next door to each for the exact same price. Each home has a price of $200,000. The first friend purchases their home now while the interest rates are at their lowest levels in recorded history. The second friend decides to wait and see if the price of the home will decline further, fully expecting that it will from the advice of a favorite uncle.

Both homes sell for the exact same price of $200,000.

The first purchase has closed with an interest rate of 4.5% on a 30 year note. The second purchase has also closed, only 30 days later, with an interest rate of 5.5% on a 30 year note. This is an increase of only 1.0% in the interest rate. Not a big deal, right?

Throughout the life of the loan, the first friend will have made interest payments totaling $164,813.42. Combined principal and interest payments total $364,813.42. The second friend will have made interest payments of $208,808.08 during the entire life of the 30 year loan. Combined principal and interest payments total $408,808.08. The 1% difference in interest rates was a difference in interest payments over 30 years of $43,994.66. This is how much the first friend will have been able to save over 30 years and invest in other income producing or retirement vehicles.

If you are considering a home purchase but don't feel that now is not the right time due to a fluctuating market and economy, Get Off The Fence. Now is the best time ever to purchase a home. SAVE your money NOW. Don't pay for it later.

Watch this video for more information - http://www.youtube.com/watch?v=wV9e04K3fEA