ABA Family Legal Guide

Buying and Selling a Home

Financing a Home Purchase

Applying for a Loan

How do interest rates affect my choice of a home?

The interest you pay on your loan is part of the cost of owning a home. For example, a 1 percent increase in the interest rate on a $100,000 loan adds approximately $85 to your monthly loan payment over the life of a thirty-year loan. Obviously, the lower the interest rate, the more you can afford to borrow.