Secrets of Buying Down Mortgage Interest Rates

In this module (34 of 46 in the Real Estate Investing Secrets course), you will learn:

• How improving cash flow by buying down your mortgage interest can help you get to financial independence faster and with less risk

• One way of calculating the benefit of buying down your mortgage interest rate and a better, more sophisticated metric I’d probably use

• We’re focusing on buying down mortgage interest rates when buying a property, but similar math could be applied when doing cash out refinances, cash in refinances, rate and term refinances or recasting a mortgage

• The big picture: buying down mortgage rates and receiving credits for taking higher rates

• How long does the mortgage buy down last

• What’s a point and how to calculate them

• Can I use credits to fund my down payment

• What is par rate and how to get par rate when talking to lenders

• Your options if you find yourself with extra money after your minimum total cost to acquire a property (down payment, reserves, closing costs, rent ready costs, cumulative negative cash flow/deferred down payment, etc)

• Comparing putting more down versus buying down your mortgage interest rate

• A sample mortgage buy down table from a lender and how to read it

• Downloadable spreadsheet for analyzing mortgage buy downs

• How to use the spreadsheet

• What are vanity rates and how to deal with them

• Using the spreadsheet to take advantage of market inefficiencies

• Use the spreadsheet to automatically calculate simple and compound rates of return for various mortgage buy downs

• Comparing the return in dollars for putting more down or buying down mortgage interest rates

• Including improved equity growth in our comparisons

• When you should not buy down your mortgage

• How to determine if you should buy down your mortgage interest rate or pre-pay PMI instead

• Plus, much, much more…

Secrets of Buying Down Mortgage Interest Rates

Here are the slides from the presentation for your convenience…