Mortgage Question?
Answers:
There is a nominal difference: $12.92/mo.
There are a couple of other items that you need to look at, not just interest rate. Compare the closing costs and fees from the Credit Union and the Lender you are getting the 6.75% Rate. The fees you need to specifically look at are the Origination Fee, Processing, Commitement and possibly an Administration Fee.
Also, if you have not yet entered into a purchase contract on a specific property, made loan appliation and have a closing date - the point is moot anyway. The rate is floating and you don't have either of the rates right now and until you lock a rate it doesn't really matter.
Go with the place that will offer you the best service, close your loan on time, answer all your questions, call you back promptly. There is more to a mortgage transaction than just the rate.
As a side note to this: if you pay a little bit of extra principle each month you shorten the overall term of the loan and in effect lower your rate of interest. Try this free mortgage interest calculator and you can try out different scenarios.
http://www.hsh.com/calc-amort.html...
I'm not sure who is more confused here. I would go with the 6.60% because the payment would be about $20 less a month than the 6.75% rate.
it will make a difference. depending on the term of your loan.
for exaple lets say the loan term is 10 yrs for illustration.
your monthly repayment over the term of the loan will be 1,492.71 if the interst rate was 6.75
whereas your montly repayment will be 1,482.77 if the interest rate is 6.60
so thats $10 you save per month. its worth 876.75 dollars in todays money.
So it is a decent amount you save but depends what you feel you can afford and not afford. And whether you are willing to pay that extra for having the loan from the bank.
All the best.
the really imporant thing to note is that any additonal payments you make on top of you monthly repayment knocks off heaps on your interest.
All things being the same, there is a noticeable difference between 6.6% and 6.75%. Your monthly payments will be roughly 2.5% higher with the 6.75% mortgage. So for a 1000/month mortgage payment that's about 25 dollars a month. That's not a HUGE difference, but why pay the extra 25 dollars a month if you don't have to?
Of course, if there are points involved that changes things entirely.
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