Average Assumable Rates vs Current Market Rates

The average assumable rate across Colorado's inventory is approximately 3.2%. The current market rate for a new 30-year fixed mortgage is approximately 7%. That's a 3.8 percentage point spread.

On a $250,000 loan, that gap is roughly $905/month. Per month.

The Rate Spread Over Time

This gap hasn't always existed, and it won't always be this wide. Here's how the spread has evolved:

2021: Market rate 3.0%, assumable rate 3.0%. Spread: 0%. No advantage to assuming.

2022: Market rate 5.5%, assumable rate 3.0%. Spread: 2.5%. Assumptions start becoming attractive.

2023: Market rate 7.0%, assumable rate 3.0%. Spread: 4.0%. Major savings potential.

2024-2026: Market rate 6.5-7.5%, assumable rate 3.2% (average). Spread: 3.3-4.3%. The golden era for assumptions.

What the Rate Spread Means in Dollars

Here's the monthly payment difference at various loan amounts with a 3.8% rate spread (principal and interest only):

• $200,000 loan: $1,085/mo at 3.2% vs $1,331/mo at 7.0% — saves $246/mo
• $300,000 loan: $1,289/mo at 3.2% vs $1,996/mo at 7.0% — saves $707/mo
• $400,000 loan: $1,720/mo at 3.2% vs $2,661/mo at 7.0% — saves $941/mo

Rate Distribution in Colorado

Not all assumable rates are average. Here's the range:

The lowest rates (2.0-2.5%) come from VA loans originated in late 2020 through early 2021, when rates hit historical lows. These are the most valuable properties in the assumable market.

Mid-range rates (2.5-3.5%) come from FHA and VA loans originated throughout 2020-2022. This is the bulk of the inventory.

Higher rates (3.5-5.0%) come from loans originated in early 2019 or late 2022, when rates were beginning to climb. Still below market, but with less dramatic savings.

Where Rates Are Headed

Nobody knows exactly where rates go from here. But the consensus among most forecasters is that 7% (give or take 0.5%) is the new normal for the foreseeable future. The 3% rate environment of 2020-2021 is not coming back anytime soon.

This means the rate spread between assumable and market mortgages will persist. As long as that spread exists, assumable mortgages save buyers serious money.

Even if rates decline to 5.5% over the next few years (an optimistic scenario), a 2.3% spread on a $250,000 loan is still $578/month in savings — $173,400 over 25 years.

The opportunity is now, and it's not disappearing quickly. Colorado currently has approximately 1,124 assumable properties — see the actual rates and calculate your specific savings.