Toll Brothers offers 3.99% 30-year fixed rate mortgages

With demand for new construction in the toilet, Toll Brothers is offering a 3.99% fixed mortgage rate for 30 years -- with 0 points!

The company has said what lender is providing the financing but with mortgage rates generally about 1% higher than that from most sources, it should entice buyers.

Here's the savings would work out on a $417,000 mortgage, the maximum amount available under the plan:

• At 3.99%: $1,988.42 per month
  
• At 4.99%: $2,236.00 per month

That's a savings of $247.58 per month and $89,128.80 over the life of the loan -- It's actually more than that if you take into account the interest that could be earned on the monthly savings. If you saved that $247.58 every month and invested it at 6% it would grow to almost $200,000 assuming you're in the 28% tax bracket.

The problem is that buying a new home is more expensive and it seems likely that the ultra-low mortgage rate will be charged to the consumer in the form of less of a discount on the home. That's the point: to spur demand.

Still, if you're interested in buying new construction, this deal should certainly make you give Toll Brothers a second look.