08/16/2025
Homebuyers, especially move-up buyers, have mentioned 3 things to me this year:
1. They don't want to pay 7% rates.
2. They don't want to take 30 years to pay off their home.
3. They are frustrated by the lack of seller paid closing costs/concessions and are reluctant to ask for concessions due to the competitive market.
On August 4th, the average 30 year fixed rate was 6.74% per Bankrate. On August 4th, I locked a move-up buyer on a 20 year fixed at a note rate of 6.125% with an APR of 6.133%. The loan amount was $540,000.
But it gets better. On this scenario, I was able to give a lender credit of 2.03% of the loan amount ($10,962) to cover all of the non-recurring third party closing costs, and even a part of the new escrow account! I was able to do all this without the need to ask for seller paid closing costs.
The biggest benefit is that when compared to a traditional 30 year term, the payment shock is minimal:
$540,000 @ 6.625% (6.74% APR) has a payment of $3,457.68
$540,000 @ 6.125% (6.133% APR) has a payment of $3,907.77
This is a payment increase of just $450.09, and your home is paid off 10 years earlier!
On the 30 year term, $3,457.68 x 360 = $1,244,764.80
On the 20 year term, $3,907.77 x 240 = $937,864.48
TOTAL SAVINGS: $306,900.32 over the 20 year term
All for the additional payment of a modest used car.
These are scenarios and options that are made possible by having access to over 100 of the best lenders in the mortgage industry. Every client scenario that I see is thoroughly researched, analyzed and shopped with the tools and lenders I have access to.
Who you work with matters.
James Cahill
Edge Home Finance
NMLS #272459
