Although on paper this seems dumb, there are other factors. Is the rent inclusive of utilities? Property taxes are a factor. Generally when renting appliances and repairs are taken on by the landlord whereas a mortgage the owner. My previous rent and current mortgage are about the same, however now that I pay utilities, property taxes, and some repairs I’m paying on average extra $600, or a 50% increase (rent/mortgage about 1200) , in housing costs.
The bank is also factoring in what would happen if interest rates went up significantly.
The overwhelming majority of home loans are fixed rate. The only portion of your mortgage that would change in the case could be your escrow payment if your property taxes and/or homeowners insurance rates change (which can both change very much)
In the UK 3-5 years is typical. In the US it’s fixed for the whole term and you can even remortgage to a lower rate during the term if it becomes available.
There are variable rate mortgages in the US. A common tactic is to get one of those, then refinance into a fixed rate loan in about five years, which is around the time the rate might change. If your property value goes up enough, you may be able to ditch the mortgage insurance then, too.
I may be confused about what you’re trying to say, but, no, first time homeowner loans are exclusive to first time homeowners. It was a program set up by Obama.
Are you suggesting landlords pay for that out of pocket and that isn’t priced into the price of rent? That they take on those costs out of the goodness of their hearts? That they don’t turn a profit, after all is said and done? That that profit wouldn’t mean savings for people on a mortgage? Give me a break.
Not at all. It is priced into the rent but it is not priced into a mortgage, so you can’t compare them dollar to dollar accurately when determining monthly expenses.
Although on paper this seems dumb, there are other factors. Is the rent inclusive of utilities? Property taxes are a factor. Generally when renting appliances and repairs are taken on by the landlord whereas a mortgage the owner. My previous rent and current mortgage are about the same, however now that I pay utilities, property taxes, and some repairs I’m paying on average extra $600, or a 50% increase (rent/mortgage about 1200) , in housing costs.
The bank is also factoring in what would happen if interest rates went up significantly.
The overwhelming majority of home loans are fixed rate. The only portion of your mortgage that would change in the case could be your escrow payment if your property taxes and/or homeowners insurance rates change (which can both change very much)
The fixed rate is usally offered for 3-5 years, at which point you must remortgage your house.
Depends on the country.
In the UK 3-5 years is typical. In the US it’s fixed for the whole term and you can even remortgage to a lower rate during the term if it becomes available.
There are variable rate mortgages in the US. A common tactic is to get one of those, then refinance into a fixed rate loan in about five years, which is around the time the rate might change. If your property value goes up enough, you may be able to ditch the mortgage insurance then, too.
You’re describing a first time homeowner loan. Not a typical mortgage in the US.
They’re certainly popular for first time buyers, but they’re not exclusive to them.
I may be confused about what you’re trying to say, but, no, first time homeowner loans are exclusive to first time homeowners. It was a program set up by Obama.
Variable rate loans are not exclusive to first time buyers.
Are you suggesting landlords pay for that out of pocket and that isn’t priced into the price of rent? That they take on those costs out of the goodness of their hearts? That they don’t turn a profit, after all is said and done? That that profit wouldn’t mean savings for people on a mortgage? Give me a break.Edit: I can’t read, apparently.
Not at all. It is priced into the rent but it is not priced into a mortgage, so you can’t compare them dollar to dollar accurately when determining monthly expenses.
I was afraid of the possibility of misinterpreting what you wrote. Sorry about that.
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