Short Term Mortgage For Interest Rate Savings?
In this episode, Scott Dillingham discusses the decision of whether to lock into a shorter-term mortgage or go with a longer-term fixed rate. He explains that while some investors are hoping to take advantage of potential future rate drops by choosing a shorter-term mortgage, this thinking is flawed. Scott advises listeners to focus on what makes the most sense for their current situation and not try to time the market. He suggests considering a longer-term fixed rate or a variable rate that can be converted to a fixed rate later.
Takeaways
- (00:00) - Introduction
- (00:50) - Interest Rates and Shorter Terms
- (05:51) - The Benefits of a Longer Fixed Term Mortgage
- (09:56) - The Option of a Variable Rate Mortgage for Potential Rate Decreases
- (12:41) - Conclusion
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Takeaways
- Investors should focus on what makes the most sense for their current situation, rather than trying to time the market.
- Selecting a shorter-term mortgage in the hopes of taking advantage of future rate drops is a flawed strategy.
- Consider a longer-term fixed rate or a variable rate that can be converted to a fixed rate later.
- Lower mortgage rates can lead to lower stress tests and higher qualification amounts for investors looking to build their portfolio.
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