Interest Rates are Rising: Should You Buy a Home or Wait?

(StatePoint) With heightened talk of rising interest rates, many prospective home buyers are understandably concerned about whether it’s the right time to purchase a home.

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Indeed, you may be wondering if you waited too long and let the historically low interest rates pass you by or if you can still find a dream home that fits within your current budget.

Experts say that it’s true that rates are at their highest in almost four years and that this year has been particularly rough, however, it’s not all bad news. Rates are still well below the levels seen 10, 20 and 30 years ago.

“Rates are still low by historical standards, helping make mortgage payments affordable for many, but your wallet might take a hit if rates continue to go up,” says Freddie Mac deputy chief economist, Len Kiefer.

How big will the hit be? Assume you buy a home with a 20 percent down payment, take out a $200,000 mortgage and are getting a 30-year fixed-rate mortgage. At a 4.5 percent interest rate, your monthly payment would be $811 with total interest paid over the life of the loan being $131,851. With a 7.5 percent interest rate, your monthly payment would be $1,119 with a total interest paid of $242,748. With an 18 percent interest rate, your monthly payment skyrockets to $2,411 with a total interest paid of $708,081.

If rates jump a half percentage, you’ll pay a bit more each month, which isn’t ideal, but the added expense will unlikely be a deal-breaker. However, if rates jump to the levels they were in 1981 (an average of 18 percent), you can expect to pay a whopping $1,600 more per month, which may cause you to think twice about taking the plunge into home ownership.

To find out how much you’ll pay, check out Freddie Mac’s free Fixed-Rate Mortgage Calculator at calculators.freddiemac.com. For other free tools and resources, visit myhome.freddiemac.com.

Don’t let current rising interest rates prevent you from buying a home this year. Experts suggest that while rates have risen recently, historically speaking, it is still an overall great time to buy.

Summer Projects with the Kids

butterflSummer is here and it’s time to get the kids outside. John Riha, writing for houselogic.com, has some ideas to spark their creativity with fun, simple home improvement projects. It’s a win-win as you will get to spend time with your kids while you’ll boost your home’s curb appeal.

When making stuff with kids, remember the Keep-It rules:

Keep it safe. Use gloves and safety glasses when necessary.
Keep it simple. They’ll come away with a sense of accomplishment if it’s a project they can handle easily.
Keep it under an hour. Kids’ attention spans are short.

1. Make Stepping Stones

This classic kids’ project never gets old — it’s gooey, messy, and arty. You’ll make the stones using ready-mix concrete or mortar; a 40-lb. bag makes 3-5 stones. Make your own forms with wood, or use old pans, aluminum cake pans, or anything that’ll create a 2-inch-thick stone.

While the concrete is still wet, decorate with beads, tiles, marbles, and polished pebbles. Wait 48 hours until the concrete is dry to remove it from the form.

2. Painting Your Mailbox

Put a little sizzle in your snail mail when you let your kids paint the mailbox.

Un-mount the box and clean it first. When dry, give it a coat of metal primer, then let your kids’ muse take over. Inexpensive craft store stencils help keep designs on track. Take the kids to the store and let them pick out designs. Don’t forget to include house numbers.

3. Planting a Shrub That Attracts Hummingbirds and Butterflies

There’s some delayed gratification with this project — the payoff doesn’t happen until the critters find the shrub — but the fun factor is high when they do.

Keep the digging to a minimum — one or two plants are plenty. Make a generous hole and have the kids fill it with outdoor potting soil, and put them in charge of watering as the plant roots in. Hold a contest to see who spots the first wildlife visitor.

Nectar-producing shrubs that attract hummingbirds include Hibiscus, flowering quince (Chaenomeles), and Lantana. Butterflies like butterfly bush (Buddleja) and Potentilla.

4. Building a Garden Gate Arbor

It’s easier than it sounds. You’ll find simple DIY kits at home improvement centers that you and your team can put together in 1 to 2 hours. If that challenges younger kids’ attention span limit, let them wander away for a bit, then call them back when it’s done. They’ll love carrying the finished arbor to the garden and setting it in the ground.

Cost: $150-$250 for a wooden kit.

5. Adding Solar Lights

This is one of the easiest projects. Gather up some solar walkway lights — the kind mounted on a stake — and have your kids put them along your sidewalk, paths, and at the edge of garden beds. When the sun goes down, they’ll get a kick out of seeing the lights switch on.

Cost: Outdoor lighting comes in all styles and prices, but you’ll find an 8-pack of solar stake lights under $50 at your home improvement center.

6. Stacking a Tipsy-Pot Plant Tower

Here’s a great optical illusion that kids will really dig. Stick a ½-inch diameter wooden dowel or piece of copper pipe firmly into the ground or a big pot. Put clay pots of various sizes onto the pipe, threading the pipe through the drain holes. Fill the pots with soil and tilt them at crazy angles — the rod holds all the pots upright. Plant easy-care plants like impatiens or petunias.

For more real estate and home info and ideas follow me on Twitter  @kimfiorenj