Helena Talbot’s blog – Making Sense Of Points, Rates And Fees

You have just found the home of your dreams and the seller has accepted your offer. Now the fun begins. You keep hearing terms like “buy down”, “discount points”, “purchase points, but you have no idea what all this means. Do they all mean the same thing or is each term something different? This is where your realtor comes in. Of course you can always call your lender; however, your realtor is the one you have been dealing with and the one that will be more than happy to explain everything to you.

Purchase Points – which are also known as a buy down or discount points. Points is a term used to define an amount of money given to the lender at closing to lower your interest rate for your mortgage loan. Every point is equal to one percent of the total amount of your loan. So if you have a mortgage that is $100,000 then one point would equal $1000. Every point you buy will lower your interest rate by a certain percentage. Just remember, the more points you buy, the more money you are going to have to come up with at closing.

The question is – is it smarter to buy points or to hold on to your money? Well, that depends on how long you plan on staying in that home and of course what you can afford to pay. If you are planning on staying in this home for more than five years then my advice is for you to buy as many points as you can. Because this will lower your monthly payments and will save you interest over the life of the loan.

Interest Rates – interest rates fluctuate daily, and when you apply for a loan it doesn’t mean that the rate you were quoted that day is the same rate you will get at closing unless you “lock in” your interest rate. Locking in your interest rate will give you a guaranteed rate within a specific time frame. Most lock in periods are for 15, 45 or 60 days. Keep in mind that the longer you lock in your rate the more it will cost you because a lender takes more of a risk to lock you in for a longer period of time.

Fees – since when have you ever bought anything that did not have some sort of fee associated with it? Well, a mortgage is no different. Some of the fees you can expect are: title fees, underwriting fees, land survey fees, appraisal fees etc. Each lender is different and will work your loan differently; some lenders will charge you lower fees but a higher interest rate.

So before you sign on the dotted line, make sure you do your homework and most definitely ask your realtor to let you know who they have had the best experiences with. Make sure there are no hidden fees and make sure that you fully understand what costs are involved and what your obligations are for the life of your loan.

I specialize in helping buyers and sellers invest in real estate in Loudoun County and Northern Virginia.

I have over 25 years experience in the real estate industry.  As a Broker/Owner with Exit Realty Talbot and Company, I bring special tools and solutions that enable me to exceed the expectations of my clientele.  If you are considering listing your property in Loudoun County or the nearby areas, ask me about our latest internet marketing systems.  I would appreciate the opportunity to earn your business.  I am experienced in listing and selling short sales.  For information on the short sale process, please visit  www.LoudounShortSaleSolutions.com.

For a free market analysis on the value of your home, please visit http://www.LoudounHomeValues.com

My past awards and designations include – 2003 President of the Dulles Association of Realtors, 2003 Dulles Area Assoc Realtor of the Year, Salesperson of the year 2000 Dulles Area Assoc of Realtors,  Top Producer awards from both the Dulles Area Association and the Northern Virginia Association of Realtors.  I am a member of the Top 5 in Real Estate Network.

I have lived in Loudoun County since 1979.  I am married with two grown children and two grandchildren.  My son in law is my business partner in real estate.  I love to jog in the mornings and spend time relaxing on my Trawler during the summer months.

Loudoun County and Northern Virginia Real Estate Sales and Solutions – Helena Talbot, Broker. I specialize in helping buyers and sellers invest in real estate in the Northern Virginia area to include Loudoun County and surrounding areas including Fairfax, Clarke, Fauquier, Prince William  Counties.  Our local neighborhoods includeLeesburgAshburn, Sterling, Potomac Falls, Brambleton, Broadlands, Lansdowne, River Creek, Belmont Country Club, Beacon Hill, Shenstone, Waterford, Lovettsville, Purcellville, Hamilton, Round Hill and Bluemont.                        Cell 703.727.9885    Office 703.574.3800

Free iPhone/Android Mobile App to search Northern Virginia real estate.  2 easy ways to get the App:  Text “Exit9” to 87778 or enter http://87778.mobi/Exit9 into your browser.

Leave a Comment

*