This tool allows you to illustrate the behavior of the down payment on your house if utilized in other areas of your PEM where you could potentially choose to place those funds. |
We have all been taught that paying interest is bad, the less you owe the less you pay, etc. BUT with Major Capital Purchases it is important to consider that “You finance everything you buy”. Here is a great example tool to show us what we could have done with our down payment in other areas of our financial model had we not given it over to the lender. Discuss with the client the rate they are earning in the risk and safe tanks. Determine a loan percentage and appreciation rate on the house, then select the down payment percentage. Advance the screen and watch the animation. Discuss the down payment facts: 1.More down reduces monthly payments 2.Down payment earns no interest 3.More down does not make the house worth more 4.More down reduces your LUC factor- Liquidity Use and Control
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