If I want to take out a mortgage with 6.5% for 200k. even though the mortgage calculator states?
October 21, 2007 · Print This Article
BR asked:
that I am paying 568k over 30 years… would I be paying only 200 if I make a few payments and then pay it all off in cash? In other words, am I only paying principal if in a year I decide to pay off my loan or am I obligated to paying the remainder of the interest even though I don’t have a loan anymore?
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that I am paying 568k over 30 years… would I be paying only 200 if I make a few payments and then pay it all off in cash? In other words, am I only paying principal if in a year I decide to pay off my loan or am I obligated to paying the remainder of the interest even though I don’t have a loan anymore?
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Josh Dunaway has been a certfied Realtor in the suburban Chicagoland area for over 20 years. Aside from starting his own real estate company, he also owns a mortgage company as well.
Some loans have stiff pre-payment penalties. Make sure that the loan you get has no such penalty. Depending on what you roll into your loan (property tax, homeowner’s insurance, closing costs, etc) you will likely pay close to your purchase price if the loan is paid off in a year.
Yes, you are correct. With a regular amort loan, when you make a payment each month, some goes to interest and some principal. If you want to pay off the loan in full, you will only pay the outstanding principle.
For example, you borrow 200k. After 2 years, your balance is around 198k (est). If you want to pay it off in full, you would pay 198k.