One of the biggest hurdles in loan repayment for most borrowers tends to be the interest rate. High interest rates tends to be not only a burden on the individual but can also hamper the growth of the economy since then people tend to save more and spend less, which means less circulation of money in the economy. In a big city like Houston, the cost of buying a home can be steep. Therefore, low interest rates in Houston could result in the increase of spending of the people which can lead to its growth.
If we sum it up, low interest rates in Houston results in:
• Less amount of mortgage interest payment – Lower interest rates means that the amount that you have to pay back each month also decreases. This results in more disposable income, which leads towards increased spending in the economy.
• More spending – Lower interest rates means that you get a smaller return from saving. This lack of incentive basically encourages people to consume and spend more in the economy and save less. This increase in spending leads to an increase in spending, thereby accelerating economic growth.
• Asset prices – Another advantage to low interest rates in Houston is that it makes the purchase of assets more attractive to buyers since they won’t have to worry about the extra interest amounts. This will encourage as well as boos the confidence of consumers to spend more.
Joan Gallardo with his 18+ years of experience as Senior Loan Officer is a wealth of knowledge dealing with FHA loans for bad credit in Texas. Read his articles to know about Government loan programs in Texas. You will get tips for the FHA lenders for bad credit in Houston.