When purchasing a home, a question that occasionally comes up is whether or not it is worth it to pay more for a mortgage in Bend, Oregon. Let us explore the options. In many cases buyers do quite well to obtain the cheapest possible mortgage. However, in some situations buyers may find that paying a little bit more is well compensated by how their needs and circumstances are addressed with extra service. Let us examine several of these situations. If any of these seem to fit for you, consider talking to your broker at Duke Warner. With decades of experience in the local market, we are well versed in helping our clients ascertain if the extra money spent may be worth it in particular situations.
A key issue that comes up for some borrowers is Private Mortgage Insurance (PMI). In general this is required on loans which do not meet the minimum 20% down payment in order to insure the lender against possible default. Many buyers manage to find creative ways of coming up with the 20 % down, but this is not always possible. If that is the case, some lenders do offer other options. One of these is the possibility of self-insuring via the offering of a higher interest rate. While this will result in a more expensive mortgage, it can be a way into a home for some buyers.
Another situation is if you need significant flexibility with the overall timeline of the transaction, like the capacity to either advance or delay it. For example, it is not uncommon for a buyer to be selling an existing home during the same period. So the closing on the new home may actually be contingent on the sale of the home that is currently owned. In this circumstance, a lender who is willing to accommodate the vagaries of the process may be well worth the slightly higher interest rate or fees.