Ready for some real talk about getting a mortgage this fall?
As rates inch higher, more homeowners are buying down their interest rates. Curious about what that means and if it’s right for you? Here’s the rundown on mortgage rate buydowns:
- A mortgage buydown is a way to lower your interest rate by paying discount points at closing. Discount points are a one-time, upfront fee.
- Each point costs 1 percent of the mortgage. For example, one point on a $200,000 mortgage would cost $2,000.
- Each point lowers the rate by 0.25 percent. So, one point would lower a mortgage rate from 6 percent to 5.75 percent for the life of the loan.
If you’ve got some extra savings and can afford it, buying mortgage points may be a smart investment.
Have more questions about buying a home or taking out a mortgage this fall? Call me – I’m here to help however I can.