Owning a home involves understanding how interest rates affect mortgage costs. Higher rates lead to higher payments, but mortgage points can lower rates by paying upfront fees. These points are optional and can be tax deductible. Calculating the break-even point helps determine if buying points is worthwhile. Discount points reduce rates, while origination points are mandatory fees. Lender credits offer lower closing costs at the expense of higher rates. Consider factors like how long you’ll stay in the home and your financial situation before deciding on mortgage points.
Continue to full article