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PSA, you will actually pay $1M for your $500k house at today's rates (lemmy.world)

submitted 3 days ago by randoot@lemmy.world to c/personalfinance@lemmy.ml

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This might be duh for some people, but if you're like me and considering a mortgage; at today's rates in the US at around 5-6%, over 30yr mortgage you will pay about same in interest as you will for your house price.

Your $500k house will cost you around $1M total over thirty years.

I was surprised.

https://m.mortgagecalculator.org/?q=A1Nzy-8KX

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[–] WhiteRice@lemmy.ml 7 points 3 days ago* (last edited 3 days ago) (1 children)

You may be surprised that the average 30 year mortgage lasts fewer than 10 years due to being refinanced or paid off like in the event of a home sale. That’s why people use the 10 year yield for comparison.

[–] lemming741@lemmy.world 4 points 3 days ago

When I bought my house in 2015, they told me 7 years was their assumption when you buy points. I bought the points thinking 3.25% for 30 was as good as it gets. Six years later I refinanced at 2.75 for 20, basically knocking 4 years of the end with the same payment.