Whether this is a good deal comes down to what you are paying to get the 6.875%, and the cash math suggests you are paying something. Run it: 20% down on a $540,000 purchase is $108,000. If total cash to close is $130,000, roughly $22,000 is going to costs. Some of that is standard closing costs and prepaids, but a chunk that size often means discount points are buying the rate below par. We lean against paying points as a default; the zero-point rate is the honest baseline. One condo-specific detail: on a conventional loan with less than 25% down, condos carry a pricing adjustment (waived under the HomeReady and Home Possible programs). That adjustment alone raises the cost of any given rate and may be part of what is driving this structure. It could still be a perfectly fine deal, and the call is yours to make. The only way to know is the Loan Estimate line by line: the par rate at no points, what the points are actually buying, and whether that condo adjustment is baked in. That review is exactly what the free Roadmap conversation is for (about 20 minutes, we run your real numbers), and we can look at whether the structure is worth reworking.