If you’re trying to get a good deal on Kansas City mortgage rates, you may have heard that you can buy points on your mortgage. Essentially, you are “buying down” your mortgage rate. But is this the right move for you and when should you do it?
Buying points on your mortgage means that you are buying some of your for a lower interest rate over time. There are two types of points:
These points will be included in your closing costs, so it is vital that you have the financial means to pay for them. Otherwise, you may find yourself paying more than you can realistically afford. In some cases, you may be able to negotiate with the seller to pay for your points.
If you want to pay as little of closing costs as possible, it would not benefit you to pay points on your mortgage. However, if you plan on staying in your home for a significant amount of time and want to pay off your mortgage early, buying points may be a viable option for you.
Buying points could help you lower your Kansas City mortgage rate, but only if you are planning on staying in your home for a very long time. That way, the cost of purchasing points doesn’t outweigh the benefit of a reduced interest rate.
Alternatively, if you want to pay off your mortgage early – and have the money to do so – paying points to lower your interest and mortgage rates could benefit you in the long run.
When deciding whether or not to buy points to lower your Kansas City mortgage rate, you will need to work closely with your lender and financial advisor. They will be able to advise you as to the best course of action based on your unique situation.
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