DIYbanter - View Single Post - Use credit card check for house down payment

writes:
So is this crazy or what? Thanks in advance for your input.

You seem to have a good handle on the pros and cons.

Talk it over with your financing guy. I'm guessing what's going to
possibly stop it is that the mortgage company that underwrites the
loan might not be so keen on a down payment that's being written on a
credit card check. However, it somehow it can be documented that only
the discount points are being paid for that way, maybe they'll go for
it.

Buying 2 discount points though, that's where the craziness of your
plan might be. How sure are you that you'll be in this place long
enough to justify prepaying so much (annually tax deductible I might
add) interest?

Shop around for rates and make sure you're not getting raped on the
loan. 6.5 to 6.625 on a conforming 30 yr fixed should be very easy to
get from a broker according to a major wholesale lender's rates for
today, assuming your fico is over 730. Those are still some
historically low numbers, and given the annual tax deduction you get
from mortgage interest, I'd be hesitant to prepay such a big chunk of
interest up front to attain a smaller monthly payment in 5 years.

Stuff happens, and in 5 years you may not be in that house, and that
credit card balance will still be there, and those discount points
will be long gone in the mortgage company's pocket.

Best Regards,
--
Todd H.
http://www.toddh.net/