When you’re buying land for sale in North Florida, you’ll have to make some big decisions – and one of those decisions could be related to whether you should buy mortgage points.
Here’s what you need to know.
Related: What are mortgage points?
Should You Buy Mortgage Points?
When it comes to making big decisions about your finances, you should talk to a financial professional. That’s the best way to get case-specific advice that works for you.
However, if you’re thinking about buying points, here’s what you need to know.
Buying points typically makes the most sense for people who want to make mortgage payments for years. If you’re taking out a short-term loan, you plan to sell in a few years, or if you have a great interest rate, you may not want to pay for points now. (You’ll have to pay for them at closing in order to save money over the life of your loan.)
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Think about how long you’ll keep the property you’re buying. When you buy points on your mortgage, you’ll save money over time – but again, you’ll have to fork it over at closing. You could even end up losing money in some scenarios. For example, if you buy four points at $3,500 each, you have to come up with that $14,000 at closing – but if you don’t keep the loan long enough to save $14,000 in interest, you may have just thrown away your hard-earned cash.
Now, in a similar scenario, if you were paying on the mortgage for 30 years, the amount that you’d save over time would be exponentially higher than $14,000.
The bottom line is always to talk to a financial professional, though. Your lender can tell you how much you’ll save if you buy points, and a financial adviser you’ve already worked with will shoot straight with you about what’s best.
Are You Buying a Home or Land for Sale in Lake City?
If you’re moving to Lake City, we can help you find the perfect place to live. Call us at 386-243-0124 to tell us what you want from your home and we will begin searching right away.
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