Which is better to pay for a home… $228K or $195K?

Case Study…  IN MY MARKET AREA…

In 1985 you could buy a NICE older home for about $65,000
You put down 5% down for FHA
The interest rate was 12% and discount points were about 7%.
You put down $3250
The discount point cost was $4,550
NORMAL commission was 7% $4,550
Other costs were around 1% $650
Total: $13,000
YOUR PAYMENT WAS $635 plus taxes and insurance = $228,600 total payments

TODAY you can buy a NICE older home for about $120,000
You put 3.5% for FHA
Your interest rate is 3.875% and discount points are NONE in most cases.
You put down $4,200
No discount point cost is $0
Normal commission is 6% $7200
Other costs are still around 1% $1200
Total: $12,600
YOUR PAYMENT TODAY IS $544/mo plus taxes and insurance = $195,840 total payments

IT’S NOT THE PRICE, IT’S HOW MUCH DOWN AND HOW MUCH A MONTH…

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