If your interest rate is only good for one year, you have an adjustable mortgage.
Look into a fixed rate.If I pay points to reduce the interest rate of a mortgage it appears it is only good for one year? ?
I would definitely get a fixed rate mortgage, we are at historic lows, it could go back up to 10% one day... i also wouldnt pay points, try and get the lowest rate at 0 points. Also as someone said work out your break even point. So if you paid $5000 for points and fees and you save $200 a month say by getting the lower rate, it would take you 25 months to break even and on the 26th month you would save money, so you want to be in the house at least 25 months in this case. Hope that helps. - that is providing you are refinancing, if this is a first mortgage i would jus get the lowest with 0 points and use the money you would have paid for the points on the house.
only pay points if it is a fixed loan and you plan to stay there for at least five years...Figure out your break even point
No comments:
Post a Comment