Mortgage Rates are inching up in Las Cruces

So the mortgage interest rates are inching up. What does that really mean for an average buyer? Not much if the rates move a tenth of a percent over several months, however....

Let’s say we are getting ready to buy a $150,000 in Las Cruces.  Last month we could have picked up a mortgage for 3.8% from a variety of local and national banks – assuming of course, that our credit is in decent shape. Our payments would have looked something like this: No PMI* because we are putting 20% down --- or $30,000

OK so our basic payment which includes property tax, no PMI *, 20% down, would be around $634.15 per month.  Also note that over the lifetime of the loan our total payments sums to a whopping $228,293 - imagine what that number would be if the interest was 8% ! Also in the state of New Mexico our property taxes are somewhat lower than other states. This is how I came up with the property tax percentage of .6%... Property tax is now based on the market value of your home divided by one third to get to the assessed value, then approximately 2% of the accessed value.  Therefore $150,000/3.333 = $45,000X.02= $900 tax which is .6 of 1%.

Now lets see what the numbers look like if the mortgage interest rate pops up to 4% which it just did. Everything else remaining the same.

The monthly increase is $13.75 - for the difference of two tenths of one percent (.2) interest rate. OK - that's not earth shattering, but over time it can mount up and make a difference. The difference in the total amount of payout is about $5,000 over the life of the loan. If we were talking about a 1% rate hike (not inconceivable) the difference would be 5 times or about $70.00 per month.

PMI stands for Private Mortgage Insurance that the bank or lender wants you to pay for if you do not have a large enough "vested" interest in the home that you are buying. In today's market it usually means that you have to purchase (monthly add-on) PMI insurance for the lender if your down payment is less than 20% of the sale or appraised value of the home. There are exceptions, such as when the government backs the loan, etc.  In the above calculations we assumed no PMI insurance because we illustrated a 20% down payment.

When looking to purchase homes, watch the mortgage interest rates, they can move quickly. Also waiting to purchase a home can mean hundreds of dollars in the mortgage payment especially when it comes to the value of the loan.

Soon I want to interview a couple of local bankers and let them tell us about developing trends that are emerging in the mortgage industry. 

Need help getting mortgage approval? Give me a call, chances are I can put you into contact with the right banker to help you get the home you want.

Gary Beeson

Las Cruces Real Estate

575 520-5515

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I know there is a lot of information, pictures and video of Old Mesilla, but it does ooze charm and I can't help but shoot a little video of the old town plaza. For those that have not been here,  the video below is a 4 minute drive around the plaza and a couple of side streets.

Old Mesilla in New Mexico

If you are close by - stop and see Joyce over at Cafe de Mesilla.  Next week I'm thinking a little wine might be fun - we have several vineyards, lets check em out....

Mesilla Valley's Highway 28 in New Mexico

As I was driving home today from Las Cruces, NM. I realized how beautiful the Mesilla Valley really is. Even in February - I can't believe this weather! It was 79 degrees and the Organ's were magic; no wonder artists love to live here, indeed it is the light. Highway 28 meanders along the Rio Grande river from Las Cruces to La Union and provides a view into the Valley's history, a very rich history in culture and change. It is my intention to uncover a bit of this rich heritage and to share with you some of my findings. For those of you used to larger metropolitan areas Mesilla Valley's Highway 28 is really a two lane road through some of the most beautiful country in the high desert.  

When I first drove this area 35 years ago, the most significant feature on Highway 28 was the large pecan orchard called Stahmann's farms, with the trees overhanging the highway the light echoing through the limbs was literally hypnotic. Since then there are several new home developments, new farms, and a few new businesses, but the old charm remains.

This blog will feature Mesilla Valley's people and places with emphasis on homes and properties along the corridor from Las Cruces to Anthony.
It goes without saying that a video here and there will spirit the soul to new heights of enjoyment. 

Each blog will sport a video and contain at least one interview with a Mesilla Valley resident or business. I will do my best to keep the videos brief and interesting.



See my video blogs of Mesilla Valley's most interesting people, places and property..