(~ UK mortgage Blog)

According to the majority of so-called experts; Generally, the news media whom make money selling salacious headlines, we may see home prices drop further than the already significant drop reported last week by the industry real estate housing price barometer the S&P Case-Schiller Index.

However, if home prices decline why can the actual cost you pay be higher ? Here’s why:

First, it is important to note that Treasury Rates, the rates that affect loan rates rose last Tuesday to the highest level in 3 months. why is this important or relevant?

let me offer you an example.

$400K purchase price today at 6% = $24,000/year in simple interest

$375K purchase price in the future at 6.5% = $24,37/ year in simple interest

Your monthly payment just went up as will the total amount you pay for the life of the loan.

Keep in mind I am not a mortgage banker. This is a very very rough example intended to outline a simple concept. I have used rounded numbers to it is easy to understand. It considers a 6.25% further decline in home prices and a further .5% rise in loan rates.

However, it should highlight that the importance of how you finance your home can be as or more important than the price you pay.

For more detailed and expert information, I have suggested a handful of mortgage/loan experts who can explain in detail to the nearest penny so you can evaluate your personal situation.

Scottsdale, AZ – Jason Mitchell , Liberty One Lending

Tempe , AZ – Gary Miljour , Cherry Creek mortgage

Phoenix – Shailesh Ghimire , AZ mortgage Guru

Tucson, AZ – Mike Jones - Tucson Mortgage

San Diego – Brian Brady -America’s #1 mortgage broker

Palo Alto , CA – Eric Trailer – Absolute mortgage

Chicago – David Soto , Illinois Home Loans

Boston Area – Ruben Austria , Maxima Mortgage

Las Vegas – Aaron Gordon, Home Loan Consultant

Atlanta – Jeffrey Pinkerton – Hillside Lending

Tenessee – Jimmy McCall – Legacy Mortgage

New York , Dominick Gaccino , First SuffolkMortgage

For loan officers, Dave Savage, a mortgage coach and consultant is a great resource to discuss loan programs that are options for you and your clients

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Copyright © 2008 By James Wexler, All Rights Reserved. *Home Prices go Down – price you pay goes Up*

Contact James Wexler (480) 221-8080 for all your Phoenix Scottsdale area Real Estate needs