5 or 30 Year Mortgage? What are the benefits of a 15 year vs 30 year mortgage? Should I refinance or just pay off my current loan with extra payments off? A must watch for all 1st time home buyers or those thinking of refinancing.
Transcript of video:
15 or 30 years which mortgage should you get that's what we're going to discuss
next are you thinking about buying a house or refinancing congratulations
fifteen or thirty years that's the question we're gonna answer right now
fifteen or thirty year mortgage first sit down with a mortgage professional if
you haven't found one find one run the numbers find out how much you can afford
number two should I spend the max I can afford you got to really think my
suggestion would be no you always want to keep a little buffer or an emergency
fund of cash for things that you might not have expected for repairs for oh I
want that new pool or something like that you want to have the extra cash
emergency fund available for those type of issues so I would say don't spend the
max even if the bank tells you this is what you can afford you know yourself
better than anything else and they would love for you to borrow as much money as
they're allowed to lend you three is it's a good idea to have a team in place
what do I mean by that have your attorney have your home inspector have
your realtor all on standby if this is a purchase not a refinance naturally then
you just need your mortgage professional have them already so when you enter that
marketing yes it is a "SELLERS" market right now you're ready to move on that
particular property most people and this is number three think about refinancing
or buying or should I say buying first-time homebuyers and they want to
do a 30-year fixed-rate mortgage great idea it's the first thing I did again
I'm not a mortgage person I don't know your situation but it gives you the
lowest number with the highest interest over the long term over the 30 years and
that's a long time so for most people that's what they decide to do is take a
30-year fixed but you have to sit down and know yourself sit down with your
finance person and say can I afford a 15-year well what's the plus naturally
fifteen years and a heck of a lot of cash you're gonna save an interest over
the long term but sit down with your financial adviser and make that decision
one thing or a tip I'm going to share with you that can save you a lot of
money and give you the flexibility of going either way in your payments so if
you have a bad month where you all of a sudden you found that you need a roof on
the property five years in you have extra money that you can that you able
to put off from paying your mortgage and that is this if you have a thirty year
fixed you can prepay principle to make it equivalent to a 15-year mortgage and
if one month or two months or three months you have an emergency payment you
need and you need that extra cash you just pay the minimum on the mortgage and
that basically can save you some significant money right now again the
mortgage rates are probably the lowest they've been in history depending upon
the week you look at the numbers but they're very very low if you don't have
the discipline to pay off those extra payments on a thirty year then you might
be the type of person that should go for a 15 year loan is short alone or over
the long term you're going to be paying less interest but if you're the type of
person like I was that has the discipline to move forward and say I'm
gonna pay off one two three or an extra payment every other month or whatever
way you want to think about it in principle and reduce the life of your
loan and thus save yourself a very large sum of money and interest then that's
the way for you to move forward so again sit down with the mortgage person sit
down with whoever you're buying that house with the decision makers in your
family and come to that decision and yes you can refinance and change things up
and that's not a bad thing to do either but that you could discuss with your
mortgage person whether it's worth it or not to refinance at the time a couple
years down the line if the mortgage rates have changed I hope this was
helpful my name is Mark Schreier licensed sales associate with century 21
American homes definitely give me one of these if you enjoyed the video and don't
forget to hit that little button to subscribe thanks for watch
