00:00Effective next month, on the 8th of May, the Federal Housing Association will start rolling out 40-year mortgages to make monthly payments slightly more affordable.
00:07And here's exactly how much that would save you.
00:09If you bought the average house today for $363,000 at the current interest rate of 6.4%, you'd pay roughly $2,200 a month for a 30-year mortgage loan.
00:17With a 40-year loan, you'd pay only $2,060, so you'd be saving $140 in monthly payments.
00:23Now, that sounds like a better option, but the total interest you'd pay over the lifetime of the loan is over half a million dollars, which is $152,000 more than the 30-year option.
00:31And this move has the internet split into two camps.
00:33You'll loan nothing and be happy, while some people are excited.
00:36However, what the internet is not telling you is that this loan only applies to loan modifications for those who are behind on mortgage payments.
00:43So no, you will not be able to shop for a brand new home and expect lower monthly payments from a 40-year FHA loan just yet.
00:49And that's because...
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