QAEconomics › Which combination of factors would result in the lowest monthly mortgage payment?
Q

Which combination of factors would result in the lowest monthly mortgage payment?

A. Big down payment, a longer term loan, and a low interest rate.

B. Big down payment, a shorter term loan, and high interest rate.

C. Small down payment, a shorter term loan, and high interest rate.

D. Small down payment, a shorter term loan, and small interest rate.

A

Answer: A. Big down payment, a longer term loan, and a low interest rate

To keep a monthly mortgage payment as low as possible it is important to swing a larger down payment, opting for long term, and having a low interest rate. You can keep your payment low by swinging for larger down payment; going for a 10% down payment instead of a 3.5% down payment in the FHA will knock the payment down simply by borrowing more money. If you desire a low payment, it is advisable to go for the longest term possible so payment can be stretched by more years.

10 months ago
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