How your mortgage rate will determine your wealth

Homeownership is a powerful wealth generator. 34% of Americans rate it as the best long term investment.
The difference between having purchased a home now versus a few years ago will affect Americans for decades to come according to economists. Refinancing later could help but will not significantly close the wealth gap.
Consider a home buyer in June 2020 that purchased a $300,000 house with 20% down at a 3% interest rate. They would pay $89,000 in interest over the first 15 years. Now contrast this with someone with a 6% interest rate, same house price, same down payment. They would pay $190,000 in interest over those first 15 years. So there is a $100,000 difference in interest payments over 15 years between a 3% mortgage and a 6% mortgage.
I would argue it’s not just $100,000 you are losing out on as you could be investing that money in the stock market and getting over 5% returns on average.
Works Cited:
https://www.wsj.com/articles/in-todays-housing-market-its-timing-over-location-eefdb890
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