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All Forum Posts by: John Burke

John Burke has started 0 posts and replied 81 times.

Private Lending & Conventional Mortgage Advice

Post: Buying Points Down

John Burke
Posted
  • Lender
  • Texas/Nationwide
  • Posts 82
  • Votes 22
Quote from @Mike Gratzmiller:

looking for advice on Points buy down... Loan of $162,000 (SFH) is currently at 6.275. I'm being told I have the option to buy it down to 5.75. How many points would that be? Do you think it's worth the $$ to do so... approx $3,150 to make that move.

Appreciate any and all advice... I'm a first time buyer.

Here's what I show my clients to help them decide if buying down the rate makes sense.
In your scenario, the difference in your PI payment @ 6.275 and 5.75 is $54.71. Your cost is $3,150 so your break even point is $3,150/$54.71 = 57.57 months or just under 5 years.
4 Votes
Pittsburgh, Pennsylvania