This may be a simple question but curious in today’s climate of rising interest rates (mid-2018) , does it make sense for long term buy and hold investors to pay for points to buy down the interest rate or keep the cash on hand instead for additional properties. I’m talking about anywhere in the point range of 1 to 3pts, bringing the rate down anywhere between 5.25% to 4.75% respectively (investment property mortgages). I’ve heard opinions from both sides, but wouldn’t mind additional feedback in light of current increasing interest rate environment.
Long term buy and hold in my view = 10 years to forever
@Jason H. Its worth paying for long term hold properties. You will have saving after recovering points in certain time.
Thanks @Harjeet Bhatti ...Do you think it’s worth paying up to 3pts to get it down 3/4 of a percentage point?
@Jason H. Depend on loan scenario:- How long you are going to keep the property? What is loan amount? How soon you can recover the points? There are so many factors which all realted to calcualtions.