Question:

Should I take a 30 or 40-year jumbo fixed rate mortgage?

Answer:

Consider an $800,000 jumbo fixed rate mortgage (FRM). The following displays what you will be paying with a 30 and 40 year terms. If you expect significant difference in the mortgage payment, you may be disappointed.

$800,000 loan 30-year Jumbo FRM at 6% 40-year Jumbo FRM at 6.25%
Monthly principal and interest $4,796.40 $4,542

Your actual rate difference on a 30 and 40-year fixed rate jumbo loan may be smaller or greater, depending on lender and area. Also, the abovementioned example does not include PMI, property taxes and hazard insurance. Those will also vary by area. Your credit history and rating will affect your rates, as well as buying mortgage points upfront.

Before you get a jumbo loan, make sure you do your homework and shop extensively for the best program. Lenders will be happy to win your business, so try to negotiate as many of the terms as possible.

Mortgage rates hit their lowest since 1955. Ask the home loan experts we recommend Quicken Loans how to take advantage of them.
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