Use These Mortgage Charts to Easily Compare Rates

June 12, 2013 13 Comments »
Use These Mortgage Charts to Easily Compare Rates

Now that mortgage rates have gone absolutely haywire, I decided it would be prudent (and helpful) to create a “mortgage rate chart” that displays the difference in monthly payment across a variety of interest rates and loan amounts.

So if you were quoted a rate of 3.5% on your 30-year fixed mortgage two weeks ago, but have now been told your home loan rate is closer to 4%, you can see what the difference in monthly payment might be, depending on your loan amount.

This is pretty important when purchasing real estate, as a significant jump in monthly mortgage payment could mean the difference between a loan approval and a flat out denial.

30-Year Fixed Mortgage Rate Chart

My first mortgage rate chart highlights monthly payments at different rates for 30-year mortgages, with loan amounts ranging from $100,000 to $1 million.

I went with a bottom of 3.5%, seeing that mortgage rates were around that level about a month ago, and probably won’t return there (EVER).

However, there is the possibility that rates could drift back in that direction. And one might be able to buy their rate down to around that price, assuming they want an even lower rate.

For the high-end, I set interest rates at 6%, which is where 30-year fixed mortgage rates were for many years leading up to the mortgage crisis. With any luck, they won’t return there anytime soon…

Of course, they could rise even higher over time, but hopefully rates won’t climb back to the double-digits last seen in February 1990.

That fear aside, this mortgage payment chart should give you a quick idea of the difference in monthly payments across a range of mortgage rates and loan amounts, which should save some time fooling around with a mortgage calculator.

Below is a mortgage payment chart for 15-year fixed mortgages, which are also quite popular.  I used a floor of 3% and a max rate of 5.50%.  Again, rates can and probably will climb higher, just hopefully not anytime soon.

15-Year Fixed Mortgage Rate Chart

15 Year Fixed Mortgage Payment Chart

Click to enlarge

For the record, you can obtain mortgage rates at every eighth of a percent, so it’s also possible to get a rate of 3.625%, 3.875%, 4.125%, 4.375%, and so on. But for the sake of simplicity, I spaced it every quarter of a percent.

These charts are really just a quick reference guide to get ballpark payment amounts. If you’re getting serious about home buying or looking to refinance an existing mortgage, whip out a loan calculator to get the exact mortgage payment.

Some Interesting Takeaways from the Mortgage Rate Charts

The lower the interest rate, the smaller the difference in monthly payment. As rates move higher, the difference in payment becomes more substantial. Something to consider if you’re looking to pay mortgage discount points.

If you look at the 30-year mortgage rate chart, the monthly payment difference on a $500,000 loan amount between a rate of 3.5% and 3.75% is $70.36, compared to a difference of $77.93 for a rate of 5.25% vs. 5.5%.

Additionally, higher mortgage rates can be more damaging than larger loan amounts. Again using the 30-year chart, the payment on a $400,000 loan amount at 3.50% is actually cheaper than the payment on a $300,000 loan at 6%.

So you can see where an individual who purchased a home while mortgage rates were super low could actually enjoy a lower mortgage payment than someone who bought when home prices were lower.

However, for someone purchasing a really expensive home, upward interest rate movement will hurt them more than someone purchasing a cheaper home. Sure, it’s somewhat relative, but it can be a one-two punch for the individual already stretched buying the luxury home.

To illustrate, the difference between a rate of 5% and 5.25% for loan amounts of $300,000 and $900,000 is about $46 vs. $138, respectively.

Lastly, note that my mortgage payment graphs only list the principal and interest portion of the mortgage payment.  You may also be subject to paying mortgage insurance and/or impounds each month. Property taxes and homeowner’s insurance are also NOT included.

You’ll probably look at this chart and say, “Hey, I can get a much bigger mortgage than I thought.”  But beware, once all the other costs are factored in, your DTI ratio will probably come under attack, so tread cautiously.

I referenced this problem in another post that focused on if mortgage calculators were accurate, in which I found that housing payments are often greatly underestimated. So you might want to drop your loan amount by $100,000 if you think you can just get by, as those other costs will certainly play a role.

Oh, and if you want to nerd out a little bit (a lot), learn how mortgages are calculated using real math, not some fancy calculator that does it all for you.


13 Comments

  1. Cindy September 10, 2014 at 9:01 pm -

    Nifty charts Colin! Thanks!

  2. Zed March 11, 2014 at 2:13 pm -

    Super charts! You just saved me a lot of time with these, thanks!

  3. Colin Robertson March 9, 2014 at 4:55 pm -

    Good suggestion Samuel…I’ll see what I can do.

  4. Samuel March 9, 2014 at 4:03 pm -

    What about a payment chart for a 10-year amortization now that 10-year fixed mortgages are popular.

  5. Vivien March 4, 2014 at 6:35 am -

    This is a good chart for my clients in the $100k-$200k loan amount range…shows payments shouldn’t make or break their decision to buy, not much more expensive even at higher rates.

  6. Colin Robertson February 7, 2014 at 12:39 pm -

    Indeed, in terms of payment, small rate increases aren’t that devastating, but total interest paid over the life of the loan can be more meaningful, which is why you should shop around to secure the lowest rate possible.

  7. Pilar February 4, 2014 at 9:55 am -

    This shows the payment difference for every .25% change in rate, and it’s still not very substantial. Imagine how little an .125% matters to the monthly payment.

    On the other side of the coin, even an eighth point can change the total amount of interest paid considerably over 30 years.

  8. Richie January 31, 2014 at 9:42 am -

    I think these charts would make people think twice about paying to lower their rate, seeing that the difference in many cases is negligible. Neat!

  9. Vernon January 31, 2014 at 4:15 am -

    This is interesting…for many people with loan amounts of $200,000 or less, a 2-3% swing in interest rates isn’t even that impactful. It’s only a couple hundred bucks a month at worst, certainly not a compelling enough reason not to buy a home.

  10. Opal December 20, 2013 at 3:23 am -

    Very handy, I’ve shared these with all my clients to give them a good idea of affordability based on rate. Thanks!

  11. Seth July 15, 2013 at 1:58 pm -

    Cool charts. This might make people think twice about refinancing. Some of the differences in monthly payment are a lot less than people probably expect, especially if their loan amount isn’t very big.

  12. Maria June 27, 2013 at 9:40 am -

    These are great tables…quick and easy way to compare rates. Thanks!

  13. Karen Highland June 21, 2013 at 11:22 am -

    Great Post, the charts are really helpful. I’ve created a post on one of my blogs, linked here. Thanks for the great info.

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