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Rates and the Cost of your Loan

Many lenders try to sell buyers on low interest rates, but ignore the cost to acquire financing. These lenders try to tease the buyer with a low interest rate, without explaining closing costs. A lower interest rate means NOTHING if you have to over pay to get it. Doing a direct comparison of costs will often times yield substantial savings for the buyer…….. we often find the difference to be thousands of dollars.

Two things we would say about the cost to acquire financing for your home purchase:

  • Don’t be fooled by low interest rates.
    Low interest rates can be the bait to get you to over pay. Always compare offers on the basis of interest rates and the closing costs to get the rate. Better yet, ask your trusted Wisconsin Mortgage Loan Officer to walk you through a comparison. Don’t be afraid to ask questions and understand exactly what your options are. A Wisconsin Mortgage Loan Officer provides advice to numerous home buyers every year. If your lender doesn’t see this service as part of their job, find a new lender at Wisconsin Mortgage Corporation.


  • Always remember, in most cases, a portion of the interest you pay on your home loan may be tax deductible.This is important to remember when you analyze the impact of interest rate, closing costs and interest paid against the cost to acquire financing. On average, 30% of your interest paid comes back to you as a deduction on your taxes (remember, your tax bracket determines the exact amount). You may also be able to deduct a portion of your closing costs. Given the power of a tax deduction, a slightly higher interest rate could be much less of an issue then over paying to acquire financing. Sheltering income with one of the few tax deductions available should be a part of your financial planning strategy. A qualified financial planner or tax preparer can give you advice relative to this issue.