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What is your opinion on 'points' for mortgages?


               
2010 Jun 21, 2:07am   2,120 views  8 comments

by vain   follow (0)  

Can someone shed some insight as to why or why not to get it?

I personally do not like prepaid interest. With all these short sales out there, the borrower has been making payments for a while, but defaults later on. Their principle is almost untouched since majority of the payments in the beginning are interest.

It'd be nice if payments were 50% interest, and 50% principle, every payment. Maybe then would these loans all have a lower principle by now.

#housing

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8   vain   @   2010 Jun 21, 7:49am  

I actually do have enough to cover the 15 year mortgage for a while but 1 year is just an estimate. I hate living at the edge. What if the in-law takes more than 1 year? I guess I have to spend a bit of money to retain flexibility. The non-recourse is not much of a burden to me. I would actually get more than twice the amount of PITI on this $230k loan shall I decide to rent out both top and bottom; so hopefully, defaulting will not be a possibility.

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