The Payment Matters More Than the Price

The Payment Matters More Than the Price

Buyers love to talk about price.

“I don't want to spend more than $500,000.”

Okay.

But I'm going to ask you another question:

What payment are you comfortable living with every month?

Because you negotiate the price once.

You live with the payment every month.

TWO HOUSES CAN HAVE SIMILAR PRICES AND DIFFERENT PAYMENTS

The purchase price is only one piece of your housing cost.

Your payment can also be affected by your:

Interest rate.
Down payment.
Property taxes.
Homeowners insurance.
HOA.
Mortgage insurance, if applicable.
And financing structure.

That's why I don't want buyers shopping based on purchase price alone.

START WITH THE LIFE YOU WANT TO LIVE

Your lender may tell you that you qualify for a certain payment.

That doesn't mean you want that payment.

There's a difference.

Maybe you travel.

Maybe you golf.

Maybe you have kids in college.

Maybe you want money left over to remodel the house.

Maybe you like going out to dinner and have no intention of becoming
house-poor so you can own another bedroom you don't need.

I care about that.

The house needs to fit your life.

THIS IS WHY RATES MATTER, BUT THEY AREN'T EVERYTHING

Mortgage rates affect payment.

So does the price.

So does the amount you put down.

And sometimes seller concessions or a rate buydown can change the numbers.

That's why waiting for one magical mortgage rate doesn't necessarily
solve the problem.

What happens if rates fall but prices rise?

What happens if today's seller is willing to negotiate?

What happens if you find the right house and the payment already works?

We look at what we know today.

GIVE YOURSELF A PAYMENT RANGE

Before we start seriously shopping, I like buyers to know three numbers:

Comfortable: This payment fits your life.

Stretch: You could do it for the right house.

Nope: I don't care how pretty the kitchen is.

Your lender can help establish those numbers based on the complete
monthly housing expense, not a guess from an online mortgage
calculator.

That gives me something much more useful than:

“I think we want to stay under $500,000.”

JILL’S INSIDER TIP

When your lender sends you loan scenarios, don't look only at the interest rate.

Ask for the total monthly housing payment and cash needed to close.

Then compare your options.

A lower rate with expensive upfront costs may not be your best answer.

A slightly higher-priced house with a seller concession may produce a
better financial result.

I'm looking at the whole deal.

JILL’S FINAL TAKE

The price matters.

Of course it does.

But the payment is the number that follows you home.

I don't want to win a house for you at any cost.

I want you to buy a house you can enjoy after the excitement of
closing day is gone.

So before we obsess over whether a house is $485,000 or $500,000,
let's find out what those numbers mean to your monthly life.

That's the number that matters.

Thinking about buying in the East Valley? Let's figure out your
comfortable payment first. Then we'll go find the house.

602-513-6209
JillHamilton.com
Jill Hamilton, REALTOR®
Buy Sell With Jill | West USA Realty