How is interest for a house payment calculated?
Yes, you are paying alot more for the home than the 160k you offered. But you have to keep in mind the tax benefits of the home. I wouldn’t necessarily go for a 15 year or an arm because if for any reason your financial status changes, your stuck in that mortgage program. What you might want to consider is making bi-monthly payments, or an additional payment here and there. Keep in mind from a financial standpoint it is better to have 6 months of reserves in the bank, and no other outstanding debt. Than it is to make additional payments on a mortgage and contribute to a 401k plan, while having debt. Mortgage debt is good debt because there is a tax benefit, and potential equity. Like I said think long and hard about an arm, 15 year or interest only loan.
