| Loans are meant to help people purchase a home | | | | can't afford to purchase a house all cash and don't |
| who would otherwise not be able to afford one. When | | | | have a choice except to pay interest on a property, |
| you sign the loan documents for a house, you are also | | | | but what you might be able to do is save your money |
| agreeing to pay the interest on a home. The interest | | | | and make a larger down payment. That will lower the |
| rate can go up and down according to an elusive | | | | original purchase amount, which is less money that the |
| index that is constantly changing. That interest rate is | | | | lender can charge interest on. If you bought the same |
| the price of receiving the lender's money. | | | | house and put $50,000 extra down on the property, |
| The benefits of buying all cash. Even with a low | | | | the total amount you would pay on your loan would be |
| interest rate, if you own a house for the entire duration | | | | approximately $102,000 less. That is $52,000 in savings |
| of a 30 year loan, you will be paying more than double | | | | in interest on your loan over a 30 year period. |
| what you bought the house for. A $200,000 loan on a | | | | Make larger payments than necessary. Waiting to buy |
| house at 5.5% interest rate for 30 years could exceed | | | | a house until you have extra money to put down will |
| $408,000. That's more than an estimated $208,000 in | | | | not benefit you if home prices or interest rates are on |
| interest. It's easy to see that you are paying twice as | | | | the rise in the market you decide to buy in. You can |
| much as the purchase price of the home by using a | | | | work down your interest by paying extra on your loan |
| loan. | | | | each month, which goes toward paying off the |
| Pay a large down to save in interest. Many people | | | | principal loan. |