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Mortgage rates are on the rise in the United States

As someone interested in purchasing a home, one of the most important things to understand is your mortgage rate. Shopping for a good mortgage rate is vital, because even a percent difference on a loan can mean thousands of dollars spent on interest that you'd rather spend on your loan's principal balance. Over time, you could end up spending $20,000 or even $30,000 in interest alone.

What's interesting now is that mortgage rates have been rising. A May 2 report states that the average 15-year fixed mortgage and 30-year fixed mortgage rates grew to an average 3.9 percent. That's up three points from the week prior.

Mortgage rates do fluctuate, which is why it's a good idea to keep an eye on them. A month ago, mortgage rates were higher than now at an average 3.95 percent. Talking percentages is fine, but when you break that down into differences in what you pay, you see a real difference.

For example, if you have a $100,000 loan with 1 percent interest, you'll pay around $1,000 in interest per year. At a 1.5 percent rate, you'd pay $1,500. Over the course of a 15 or 30-year loan, that adds up to a significant amount of money. This is why lower rates, even if it's only by .05 percent, are appealing and something to look out for.

The mortgage you get could be fixed or variable, and there are many different contract terms to consider. Your attorney can help you review different mortgage options to find the one that fits best with your financial plans.

Source: Bankrate, "Mortgage rates increase for Tuesday," Claes Bell, May 02, 2017

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