Skip to main content

Buy points, wait to refinance, or large principal payment?

First time buying a house. I'm buying a 1.6 mil home and putting 30% down (about 480k). That got me a rate locked of 5.75% with no points. I could buy up to 2.5 points at a cost of around 28k which would get my rate down to 5.125%, but I ran it through a calculator and it said my break even wouldn't be for 64 months (5.4 years). Actually, it might be more like 7 years if you consider I could invest the 28k and earn a % on it.

Would I be better off just waiting to see if rates drop prior and refinancing?

I also plan on selling our condo (maybe around 800k) in a couple months and debating if I should just put a massive chunk of that towards the mortgage principal to lower my long-term interest hit/shorten the mortgage or if I should just invest it.

I get the prevailing logic is that if rates are super high, you're better off just paying off the mortgage quickly... if rates are low, you're better off just investing the money... but this 5.75 range I'm in seems to be teetering in either direction and I guess I need to consider the possibility of being able to refinance in a couple years, which changes all my long-term math.

Thanks in advance for any thoughts/suggestions.

submitted by /u/Investnew
[link] [comments]

source https://www.reddit.com/r/RealEstate/comments/15bsw0t/buy_points_wait_to_refinance_or_large_principal/
Labels:

Comments

Post a Comment

Popular posts from this blog

North Carolina – “One to Buy; Two to Sell”

I realize I will likely have to contact a real estate attorney but also hoping to hear insights and experiences from others! I have a house in NC that I bought by myself in 2009, and paid off, in full, in 2022. I got married in 2023. My spouse and I have not lived in the house as our "marital residence". We have maintained separate residences even after we got married. (That a separate topic!). I am now selling this house. Realtors have told us that my husband has to sign the deed at time of transfer but I am not convinced since the house has not been our marital residence. The realtors like to use the phrase "one to buy; two to sell", which seems like a broad-stroke statement which is not applicable under all circumstances. And of course, the realtors don’t realize the details of my specific circumstances: I purchased and paid for the house in full prior to marriage Only my name is on the deed And most importantly, we have never lived in the house as a marit...
Post a Comment
Read more

Question With Tricon "Pending ID".....

My wife and i, along with 2 other peopl applied to rent a house, and our application says "Approved, Pending ID". Anyone else know what that means? Do we pretty much have the place or are we missing something? submitted by /u/Itskrueger [link] [comments] source https://www.reddit.com/r/RealEstate/comments/1orixqj/question_with_tricon_pending_id/
Post a Comment
Read more

warning about Biggins and Scott Brunswick

his is a general warning for people who use this agency to rent a property. I am going to share a disgusting experience that I had with the above agency. I was new to the rental experience after a marriage breakdown so I answered a add on Real Estate .com and met a guy in Maribyrnong to look over a apartment . He suggested he was not only going to be my roommate, but he also worked at the company in Brunswick. All looked good and myself and a lovely lady moved in to the apartment in late March. Everything was going well ,we were paying our rent and things were moving forward with 3 people coming from different age groups and different upbringings. Then on the 25th of June out of nowhere 3 Breach Notices appeared on my email from my roommate but on Biggins and Scotts letterhead. I was completely surprised and after trying to reason with the sender of these documents, I then decided I had to call his boss the Director of Biggin and Scott in Brunswick. David told me that he was ...
Post a Comment
Read more