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"What's your rate?" is the wrong first question.
Rates are hovering around 6.74% on a 30-year fixed right now. But the rate is maybe 60% of the story on what a home actually costs to finance — and the other 40% is where deals fall apart at the closing table.
The three costs that don't show up in the rate quote:
— Closing costs: 2%–6% of the loan amount. On a $450,000 loan, that's $9,000 to $27,000, due upfront. — PMI: 0.5%–1.5% of the loan per year. That's $100–$560/month, and it applies until you reach 20% equity (22% for automatic removal). — Escrow: $400–$1,200/month for property taxes and insurance, folded into the payment — and refinancing can create a temporary funding gap most borrowers don't plan for.
We published a full breakdown with real numbers at four loan sizes, the complete closing-cost line-item list, and how to time PMI removal so you're not paying it longer than you have to.
Full article: https://dreamhomemortgage.com/closing-costs-pmi-escrow-true-cost-of-home-financing/
The three costs that don't show up in the rate quote:
— Closing costs: 2%–6% of the loan amount. On a $450,000 loan, that's $9,000 to $27,000, due upfront. — PMI: 0.5%–1.5% of the loan per year. That's $100–$560/month, and it applies until you reach 20% equity (22% for automatic removal). — Escrow: $400–$1,200/month for property taxes and insurance, folded into the payment — and refinancing can create a temporary funding gap most borrowers don't plan for.
We published a full breakdown with real numbers at four loan sizes, the complete closing-cost line-item list, and how to time PMI removal so you're not paying it longer than you have to.
Full article: https://dreamhomemortgage.com/closing-costs-pmi-escrow-true-cost-of-home-financing/
