OK, so you are a first time buyer looking to purchase a home. In the Oakland Montclair and Oakland Hills areas the average entry level home is around $600,000. If you were to purchase an average Oakland Montclair home with a 20% down payment and a loan of 80% at an interest rate of 5.375%, your payment (not including taxes and insurance) would be around $2687 per month.
Now imagine the same Oakland Montclair home, the same $600,000 purchase price and the same 80% loan. Now however the interest rates have gone up by 1%. That small 1% increase in interest rate is going to increase your monthly payment by an enormous $306 per month.
At today’s interest rates of (5.375% 30yr fixed) for every $100k you borrow your monthly payment is about $559/month. If you purchase your home at a lower interest rate by just 1 percent, that means that you could borrow about $50,000 dollars more and still have a lower payments!
If you really want to get down to loan nitty-gritty I recommend that you should call a good local mortgage broker. Ask them to run a couple of scenarios for you. I’ve recently had some great working experience with Brian Moggan at MetLife Home Loans (510) 339-4400 or BMoggan@MetLifeHomeLoans.com  . I don’t have a vested interest in you calling him, I just know that he offers good loan products at good rates and provides great service.CONTACT BRIAN  if you have any real estate needs in Oakland, Berkeley or Piedmont CA.