Zillow Advice: Mortgage Rates - 4.375 % with 2.7 points, would you take it ? We are. http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ Zillow Advice | Zillow Real Estate I hope the offer came through ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ I hope the offer came through as advertised.&nbsp; With the 2.7% discount it seems to be in line with most offers.&nbsp; Just north of HDG proper you can qualify for UDSA loans.&nbsp; 102% financing at around 4.875%.&nbsp; And no <a href="http://www.zillow.com/mortgage/">mortgage</a> insurance.<br/><br/>Let me know if this helps. Fri, 05 Mar 2010 05:47:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-03-05T05:47:00Z Consider a 15 year with the ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ <p>Consider a 15 year with the same cost @3.75% you simply can't beat the savings.</p> Sat, 06 Feb 2010 01:27:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-02-06T01:27:00Z I also own an accounting ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ I also own an accounting firm and for high income buyers this may prove to be a wise move, especially when we get into the high tax brackets of 35-70% the more deductions the lower the % of tax paid because points and interest on a purchase are tax deductible in the year they are paid. This could mean depending on income and how other deductions apply reducing the taxable income 8-26 % or more. <br/><br/><p>You can deduct the points in full in the year they are paid, if all the following requirements are met:</p><ol><li>Your <a href="http://www.zillow.com/mortgage/">loan</a> is secured by your main home (your main home is the one you live in most of the time).</li><li>Paying points is an established business practice in your area.</li><li>The points paid were not more than the amount generally charged in that area.</li><li>You use the cash method of accounting. This means you report income in the year you receive it and deduct expenses in the year you pay them.</li><li>The points were not paid for items that usually are separately stated on the settlement sheet such as appraisal fees, inspection fees, title fees, attorney fees, or property taxes.</li><li>The funds you provided at or before closing, plus any points the seller paid, were at least as much as the points charged. You cannot have borrowed the funds from your <a href="http://www.zillow.com/directory/lenders/">lender</a> or <a href="http://www.zillow.com/directory/lenders/">mortgage broker</a> in order to pay the points.</li><li>You use your loan to buy or build your main home.</li><li>The points were computed as a percentage of the principal amount of the mortgage, and</li><li>The amount is clearly shown as points on your settlement statement.</li></ol><p>Courtesy CS Thompson Reuters</p> Sat, 30 Jan 2010 13:16:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-30T13:16:00Z One other consideration that ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ One other consideration that comes into play with many of my clients when considering points is their tax rate. &nbsp;<br/><br/>Points on a purchase are tax deductible in the year they are paid. &nbsp;Many of my clients who purchase in the same year in which they realize a "one time" income windfall (due to a stock option liquidation event for example) buydown their rate by 2-3 points. &nbsp;They do so because their income windfall places them into a significantly higher tax bracket in this year then they&nbsp;expect to be in the future. &nbsp;<br/><br/>&nbsp;By paying points now, these clients are able to write-off, for example, 50% of their points now rather than perhaps only being able to write off 38% of their mortgage interest payment (due to being in a lower tax bracket) over the life of the loan. &nbsp;They also partially insulate themselves from any future legislation that may place caps on the amount of interest that they can writeoff. &nbsp;<br/><br/>Disclaimer: &nbsp;This is not tax advise. &nbsp;<br/><br/>&nbsp;<br/><br/><br/><br/>&nbsp;As such their effective after tax cost of these points allows them to breakeven significantly sooner than they would otherwise. Fri, 29 Jan 2010 06:58:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-29T06:58:00Z I have never recommended ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ I have never recommended any of my clients to pay more than 1 point. If you decide to pay 2.7 points, you are probably looking at around 15 years to break even. In 15 years, you may have refinanced, or sold the home, in which case, you will lose the upfront points you have paid...<br/>I would stick with 4.875% and no points, and low closing costs...<br/>Good Luck. Thu, 28 Jan 2010 04:22:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-28T04:22:00Z I would check with Provident ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ I would check with Provident Funding.&nbsp; The last time I looked the 4.50% 30 year fixed rate was arounf 1.50 Points.&nbsp; Consider 4.625% at close to .75 points.&nbsp; Most of my clients do not pay to buy a rate down below the market rate unless they are positive they will be in the home for 6+ years.&nbsp; USAA does have a good reputation.&nbsp; But, check with Provident Funding too. Sun, 24 Jan 2010 19:51:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-24T19:51:00Z If you are, why ask? http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ If you are, why ask? Sun, 24 Jan 2010 18:35:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-24T18:35:00Z Take the 4.875% no point ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ Take the 4.875% no point loan.&nbsp; Put the buy down of $5000 and the $6500 into a taxfree bond fund.&nbsp; Apply the interest earned to principal and pay your <a href="http://www.zillow.com/mortgage/">mortgage</a> off much sooner, have a better tax deduction and $11,500 saved! Sat, 23 Jan 2010 01:59:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-23T01:59:00Z I'm with Sherrie,If it "feels" ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ <p>I'm with Sherrie,<br/>If it "feels" right, do it. Your LO may give you advice, if it was me, I'd tell you not the right thing to do. But, its your decision. "Please, call me back in 8 years to let me know this did end well for you."<br/><br/>Most folks will not break-even.&nbsp;Something, usually happens. The best plans of mice and men, usually change. .... Best wishes, Rudi<br/>'</p> Sat, 23 Jan 2010 01:35:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-23T01:35:00Z These are all vaild points. ... http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ These are all vaild points. We figure it is not our money, it is the tax payer handout of $ 6,500. The buy down 1/2 percent point will end up savings up over $ 27,000 over the life of the <a href="http://www.zillow.com/mortgage/">loan</a>. We don't move very often and have been in our last home over 17 years. So we get a tax write off in 2010 for the points that actually adds up to over $ 32,000. If we put the $6,500 in a CD for 20 years at 2% ends up around $ 7892. or we could just blow it on the new house and get no return. Fri, 22 Jan 2010 17:59:00 GMT http://www.zillow.com/advice-thread/4-375-with-2-7-points-would-you-take-it-We-are/317219/ 2010-01-22T17:59:00Z