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Mortgage Market Update
Rafael Santos
Rafael Santos
Wednesday, September 2, 2026
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Loan term: what it actually costs you |
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Hi there—this week I want to talk about a choice that affects your entire loan, but doesn't always get enough attention.
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National Mortgage Rates · August 27, 2026
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Source: Freddie Mac PMMS & Optimal Blue via FRED
Rates shown are national averages and are provided for informational purposes only. Actual rates vary based on credit profile, loan amount, and market conditions. Please contact us for a personalized rate quote.
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Smart Money
Why your loan term matters more than you think
When you're shopping for a mortgage, the interest rate gets all the attention—but your loan term (15 years, 30 years, or somewhere in between) shapes your entire borrowing life. A shorter term means higher monthly payments but you build equity faster and pay far less interest over time. A longer term lowers your payment, which can free up cash for other goals or help you qualify for a larger loan. There's no universal "right" answer; it depends on your income, timeline, and what else you want your money to do. The good news is we can run the numbers on different scenarios so you see the real trade-offs before you decide. Let's talk through what term makes sense for your situation.
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Tip of the Week
Your mortgage interest may be tax-deductible if you itemize. Check with your tax professional to see if it benefits you.
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Tips for Homeowners
Understanding Mortgage Points
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1.
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One mortgage point equals 1% of your loan amount. Paying points ("buying down the rate") reduces your interest rate — typically 0.25% per point, though this varies by lender and market.
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2.
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Calculate your break-even: divide the cost of the points by your monthly savings. If it takes 4 years to break even and you plan to stay 10 years, buying points makes sense.
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3.
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Points paid on a home purchase are generally tax-deductible in the year paid (if you itemize). Points on a refinance must be deducted over the life of the loan.
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Have questions about how any of this affects your mortgage or home purchase? We're here to help — reach out to the Rafael Santos team any time and we'll walk you through your options. |
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