This post was prepared by Hanley Mortgage Group.

 

High Ratio mortgages are for purchases of less than $1 million and with less than 20% down. Conventional mortgages are for purchases with a minimum of 20% down.

 

*These calculations are based on $100,000 mortgage amount, 25-year amortization and average rates at the date indicated below.

 

Rates

January 2016

High Ratio – 2.44% = $445/month per $100k Conventional – 2.69% = $457/month per $100k

 

January 2017
High Ratio – 2.64% = $455/month per $100k Conventional – 2.94% = $470/month per $100k

 

January 2018

High Ratio – 2.99% = $473/month per $100k Conventional – 3.54% = $501/month per $100k

 

January 2019
High Ratio – 3.69% = $509/month per $100k Conventional – 3.89% = $520/month per $100k

 

The Difference from 2016 to 2017

High Ratio = $10/month per $100k Conventional = $13/month per $100k Example: $400k
HR = $40/month or $480/year Conventional = $52/month or $624/year

 

The Difference from 2016 to 2018

High Ratio = $28/month per $100k Conventional = $44/month per $100k Example: $400k
HR = $112/month or $1,344/year Conventional = $176/month or $2,112/year

 

The Difference From 2016 to 2019

 

High Ratio = $64/month
Conventional = $63/month
Example: $400k
HR = $256/month or $3,072/year Conventional = $252/month or $3,024/year

 

What does this mean?

This means that clients are qualifying for approximately 25% less than what they were in 2016, pre-stress test. With higher rates and the stress test, qualification and monthly payments are greatly affected.

 

Older Blog Posts