Posted on: 11th Feb, 2011 04:55 am
How do I find the least costly mortgage? Does it make sense to pay more points for a lower interest rate?
Hi. On a 30 year fixed mortgage, I'd always recommend paying more points if the monthly savings are substantial enough over a few year period for it to be worth it. If it costs you $3,000 for a buy down and you'll save $5500 over the life of the loan, it probably wouldn't be worth it. The key is realistically analyzing how long you'll be in the home. If you were going for a short term loan, I'd recommend taking a higher interest rate to decrease the fees as much as possible. I hope this helps.