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This is correct, you will pay more to service the loan but only until you can refinance it. If you pay more in a low interest rate regime you have no way to improve your situation, and no way to sell if you need to.

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Yes, I would rather pay usurious rates with a commensurately low price. Even though it would be terrible basically having the vast majority of my monthly payment going purely to interest for a long time, it's possible to:

- refi at a lower rate in the future

- sell the house without having to take a huge loss compared to low-% bagholders

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