2.7% interest rate to 6-7%, how bad is that?

[sun1982]

I purchased my first home in 2017 with the intent of fixing it up a little bit and then upgrading. Since my interest rate is 2.7% I've held off during all this chaos. I still really want to upgrade because I got a promotion at work and some issues this house has would take more money than they're worth and wouldn't pay off when sold. Called several mortgage companies to get an idea of what my current interest rate would be and it's all around 6-7. In Texas, credit is 789, any advice? Thanks!

TLR

Is giving up a 2.7% interest rate to upgrade to a nicer house worth it in 2023? The rough interest the bank quoted me would be around low 7's to high 6's.

EDIT:

Some really good answers and comments so far. Thank you everyone!

 

[mallibhaskararao]

@sun1982 Figure up how much the extra monthly payment would be for the new loan and put that in a separate savings account each month as if you were paying the loan. After a few months you’ll know how tight or loose your monthly budget will be.

I wouldn’t want to give up a 2.7% for 6%, especially if the house I’m currently living in is “ok”.

 

[eyetube]

@mallibhaskararao This is solid advice that you rarely suggested. A very easy way to see how much it may stress a budget without taking any risk.

 

[shinobikun]

@mallibhaskararao Great advice here.

 

[baruch_atah]

@sun1982 4% on a $300k loan is another $1000/month in interest alone. I wouldn’t give up that 2.7% mortgage unless I really needed to.