There's No Such Thing As Low Interest Rate

Summary

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It's time I provided some proof to these outlandish statements. Fm going to need your help. I would like for you to review one of your recent mortgage statements. Take a close look at the total amount paid. For the sake of simplicity, disregard whatever payment was applied to cover your taxes and insurance-assuming your taxes and insurance payment is included with your mortgage payment. Look at the amount that was applied to interest and the amount that was applied to reduce the principal balance. For those of you who don't have a mortgage statement readily available here's a glimpse of what youVe going to see once you take a look at your mortgage statement. Assuming your mortgage payment is $1,000 (excluding taxes and insurance) $900 dollars of that payment is going toward interest and $100 of the payment will be applied to the principal balance. If 90 percent of the payment is applied to interest would it not be logical to state the interest cost as 90 percent? Let's look at this from another angle. Assume you take out a mortgage for $100,000 over 30 years (360 months) at a rate of 7.5 percent. Your payment on that loan would be $699.21 per month. Doing some quick math you can see that if you make payments of $699.21 per month each and every month for the next UO years, your total payback will be $251,715.60 ($699.21 x 360-months). Remember, you borrowed $100,000. This means that of the $251,715.60 payment, $151,715.60 is interest. If 150 percent of the total payment is applied to interest, would it not be logical to state the interest as 150 percent?

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There's No Such Thing As Low Interest Rate

The question I get most often day in and day out when people are inquiring about my mortgage services is-What's your interest rate?

The truth of the matter is this question cannot be accurately answered without first ascertaining your credit and financial status in ...

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