Whether you should buy points depends on your individual circumstances and goals. Consider paying points if: You have extra cash available for closing costs. You plan to stay in the home long enough to “break even” (the point where your monthly savings exceed the cost of the points). You prefer long-term savings over short-term cash flow.
Itemizing: You list out all your eligible individual deductions (including mortgage interest, state and local taxes, charitable contributions). You choose this method if the total of your itemized deductions is greater than the standard deduction.
Standard Deduction: A fixed dollar amount that reduces your taxable income. For 2023, it’s $13,850 for single filers and $27,700 for married couples filing jointly. Many taxpayers now find the standard deduction is more beneficial than itemizing.
The fundamental difference is ownership and structure. Banks are for-profit institutions owned by shareholders, and their primary goal is to maximize profits for those shareholders. Credit unions are not-for-profit financial cooperatives owned by their members (customers). Any profits are returned to members in the form of lower loan rates, higher savings yields, and reduced fees.
Yes, for new construction, lenders often offer extended rate locks, sometimes for up to 12 months. These longer locks provide peace of mind but usually come at a premium, such as a higher interest rate or additional fees, to compensate the lender for the extended guarantee.
No, it is very likely that your property taxes will change over time. They can increase if your local government raises tax rates or, more commonly, if the assessed value of your home increases. This often happens after you purchase a new home (as it is reassessed at the sale price) or after a major renovation.
