Home loan question

[airborne1]

Hello! Need advice on purchase of first home for physician in practice for 3 years without student loans. Planning to use Regions bank physician loan for 400k loan with 100% financing, zero PMI, 15yr fixed @ 3.25%. Have 80k of liquid assets not invested, without significant amounts beyond that for emergency reserve (30k in retirement accounts).

1. Want to know if there is a sweet spot for placing a some of the liquid assets as down payment towards principle to reduce overall interests VERSUS holding onto those liquid assets as emergency funds perhaps invested in vanguard or some time of higher return account than a checking account.

2. Would it be worth it to pay down 1-2 points in order to lower the interest rate further for overall period of loan?

Thank you for your help!

[Dicast]

I'm looking at buying a house in the near future and looked at physician loans as well.  When I pinned my bank down (BBT) the difference between interest rates on conventional and physician loans was about .5%.  At 80k of assets you are close to a 20% down for a conventional loan.  If you can delay long enough to have some cushion for closing costs, moving and a little emergency fund I would think you may be able to find a better overall rate.

A lot of this has to do with your actual time frame or motivation for buying a house.  My current lease is up in June, month to month payments sky rocket the amount my landlord wants and right now I commute about 45 minutes each way in a large city, sometimes I spend over an hour in traffic.  All of these factors push me to want to buy a house sooner rather than later despite having some student loans at this time.

1. Hold off if you can until you can do both.

2. If you are planning to stay put paying points can help.  There is a great page at the mortgage professor about this topic and there is a calculator to help with the specific calculations if you know the values you want to use. Points

[chrisg202]

I'm trying to refinance my mortgage

I got decent offers from bank but I got much lower interest rates (by 0.125 to .25%) and lower fees from private lenders like (goodmortgage.com , McGlone, BestratesUSA)

Are these lenders really serious about their offers or it's just a trap until you sign in and they will find a reason to increase the rates as we go more serious?

Advise please

[iglord]

Chris wrote:

I’m trying to refinance my mortgage

I got decent offers from bank but I got much lower interest rates (by 0.125 to .25%) and lower fees from private lenders like (goodmortgage.com , McGlone, BestratesUSA)

Are these lenders really serious about their offers or it’s just a trap until you sign in and they will find a reason to increase the rates as we go more serious?

Advise please " />

Click to expand...

I'm going through a refi with the company that popped up at the top of the Zillow search I ran. The rate lock was part of the application, so not worried about that.

[Zaphod]

Your interest is your only tax write off, and any money placed down is basically sunk cost and lost (values change). However, with a zero down loan you are exposed to all sorts of issues, like small changes in valuation will change your ability to move, sell, etc....most people are uncomfortable with that. I did 10%, but Id rather have done 5 given I'd like to be on the opposite side of that risk that the bank wants to be on. 0% loans can make it very difficult to not lose money if you are forced to sell even after seemingly long time periods (5+years) due to transaction costs.