Comparing a 5.55% two-year fixed quote on a $910,000 New York purchase

L

LucaArcher

First-time buyer
Getting this comparison wrong could leave us paying heavily for an early exit even if the headline rate looks competitive. The property is in New York at about $910,000, and the quote fixes the rate at 5.55% for two years. The initial advertisement showed a cheaper rate, but our quoted costs reflect both the applicable loan-to-value band and arrangement charges.

We may move within those two years, so APR alone seems too blunt. Would you compare total interest and fees at several possible sale dates, including any early-repayment charge? I also need to establish whether the loan can move with us and whether the fees are paid at closing or added to the balance. Refinancing after two years is one possibility, not something I want to build in as a certainty.
 
For your situation, I would compare total financing cost over several realistic exit dates, not just APR. Run the numbers at 12, 18 and 24 months: upfront fees, interest paid, any lender credits and the cost of repaying or moving the loan. Keep principal repayment separate, since that builds equity rather than being a financing expense.
 
The missing figures are the actual loan amount and down payment. A small change in loan-to-value could explain why the advertised offer does not match your quote. Also, are the arrangement fees paid upfront or added to the balance? That affects both cash needed at closing and the interest calculation.
 
I would not focus only on the expected move. Plans slip, sales take time, and refinancing may be less attractive when the two years end. Test whether the monthly payment remains affordable under the post-fixed terms quoted by the lender, without assuming a favorable refinance. That rate-reset risk could outweigh a modest difference in fees today.
 
Ask each lender for an itemized quote using the same loan amount, down payment and date, then put the costs into one sheet. I would also ask what “portability” means in this specific offer. Does it preserve the rate, require a fresh approval, or still trigger fees? The label alone is not enough when a move is plausible.
 
Agreed on clarifying portability, although I would not let that feature dominate unless the conditions are clear in writing. A useful table would have columns for cash due at closing, monthly payment, interest through each possible move date, exit costs and remaining balance. Then add Noor’s stress case for staying beyond two years. That shows both the likely short holding period and the cost if the move never happens.
 
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