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If Interest Goes Up, The House You Could Afford - Just Shrunk

May 25, 1991.

We got the key to our first home.

Interest rates were over 9%.

The Persian Gulf war had ended.

We had 2 cars, and 2 payments.

We had 2 kids in diapers.

We had student loans.


We had a piece of the American Dream, and we were excited!

My husband's first job out of college paid a third of my son's first year out of college. However, our piece of the dream cost $88,000 at 8.5% interest. Most starter homes in Chandler and Gilbert currently sell between $200,000 to $275,000. This is about three times more than we paid in 1991... so, it's all relative, except - one's ability to buy more house lowers as interest rates rise.

Had our $88,000 budget been paired with a 4% interest rate, we could have gotten an extra bedroom or two. 25 years later, we may have never moved if we had the space we needed with our first purchase.

This visual from Academy Mortgage perfectly illustrates how interest rates impact your buying power.

Recently the Feds raised the rates with interest averaging around 4%. Some analysts predict more increases this year, others think they may fall. You can always refinance if rates fall, but, it's hard to regain the square footage you lost because you waited six months and interest rates increased.

If you are thinking about a larger family home, now is the time to get pre-qualified and start the search. I'll help you navigate your options and find your American Dream.

If you're underwater, or think your smallish home would make a great investment property, great news, there is a new guideline to conventional financing that allows 75% of rent from a lease agreement to help offset a new mortgage.

Keep your current home, rent it and use that income to help you qualify for a new loan and get the space you need today.

I'm here to help. Send me an email at: or call

(480) 251.5901.

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