Today, we're talking about how important it is to look at fifteen-year mortgages for your home.
The first thing you need to do when buying a house is talk to a lender to find out what you can comfortably afford. "Comfortably" means not putting all your money into your mortgage, leaving you with room in your wallet for living expenses.
Most people only look at a thirty-year mortgage in the Orlando market. However, I recommend that you look at a fifteen-year mortgage as well. You'll find in today's central Florida real estate market, you can get a much better rate on a fifteen-year mortgage than you would on a thirty-year mortgage. Now, over time, that will save you a lot of money on your home.
But how much? Well, for example, if you have a $200,000 mortgage amount, let's compare the 4.5% on a thirty-year plan and the 4% on a fifteen-year plan. For the thirty-year plan, just in interest, you'll be paying $165,000 in order to borrow $200,000. Compare that to the fifteen-year plan, where your interest will be just $66,000. That's almost a $100,000 difference between a thirty-year mortgage and a fifteen-year mortgage.
There is, of course, a difference between the monthly costs. Going back to the $200,000 mortgage, the 4.5% would be around $1,010 a month, while the 4% would be around $1,480 a month. So for around $470 more a month, you could be saving a ton of money, so make sure to check out the fifteen-year mortgage on your home!
As always, we are here to help you! Please feel free to Contact Us, and I hope that I have helped you get real estate smart.
