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Q: A home is advertised as having an assumable loan at 2.5%. What does this mean? A: It sounds too good to be true, but a seller may indeed have an assumable loan for which the buyer can "inherit" the low mortgage rate. The buyer will have to be qualified at the lender's specific standards for this loan, and it's worth the ask! In a recent example, a home listed for $1,350,000 with this low assumable rate would have same monthly payment as a $900,000 home at today's rate.
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Q: With higher interest rates is it still better to buy vs. rent? A: This dilemma is shifting over time as carrying costs are higher and rents are leveling out. To figure out the breakeven point for the number of years you need to live in a home to break even, add up the total costs of purchasing the home, including closing costs of the loan, title and escrow, plus the carrying costs which are the mortgage payment, property taxes, homeowners insurance, HOA dues, maintenance, repairs and updates. Then divide this sum by your NET gain, which is the market value at the time of sale less selling costs, less purchase price. If you want to skip the spreadsheet, I also love online calculators like www.nerdwallet.com - play around on the rent vs. buy calculator. It's fun! (for me at least, ha!) Keep in mind the calculations don't take into account the stability of controlling where you live and for how long, and in an appealing market like Bend where long term appreciation should always play out, I'm a huge proponent of buying.
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