Need advice
I bought a $500,000 home with an interest rate of 3%. My family and I love the home and we plan to stay here for a very long time. My business is doing well and I have extra money to invest. My lender offered mortgage points and told me that it can decrease my overall mortgage payments. Is this true? I also want to know how much does each point lower my interest rate? by reeds8 from Proctor, Montana. Oct 7th 2021
Joe Metzler (JoeMetzler)
#17 ranked lender in Minnesota - 4,848 contributions
"Discount points" are an up-front fee paid at closing to lower the interest rate below what the real rate of the day actually is. A point equals 1% of the loan amount. Deciding to buy down the rate is just simply math. How much do the points cost you, what is the monthly payment savings, when is the cost vs savings break even period. then, will you be in the home long enough for it to make financial sense, and do you have the additional up-front money needed to pay it today? Points and the rate difference they provide will vary on any given day as the mortgage market moves. Points are not automatically a good thing or a bad thing. Do the math, and you'll have your answer. I lend in MN WI IA ND SD. Find me at JoeMetzler.com - Cambria Mortgage, NMLS 274132 (651) 552-3681
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