Mortgage: Fixed 30 years interest rates
Posted 27 September 2012 - 08:21 PM
Posted 27 September 2012 - 09:05 PM
and while we are on the topic of mortgages...where the heck is dimbee?
Posted 28 September 2012 - 10:02 AM
Disagree with you here.
Pay off debt as soon as possible, no matter what.
The problem is, only very dedicated folks will take the time to actually invest that extra 50 or 100.
IMO a paid off house that you can never lose is an unbelievable place to be.
Pay off the house in 15 year or less, and then you can really invest when you don't have a mortgage.
You disagree because you assume the person would not invest the money. Therefore, the problem with the proposal is not the proposal itself but the stupidity of the person.
30 year mortgage with investing the extra money would likely produce more economically than making a higher mortgage payment.....it is quite simple.
Tax effected mortgage rate is less than 3%. As long as you can invest and make a higer return than your mortgage rate (long term the avg yield in the market is about 10%), you WIN.
If a person is too stupid to invest the money and blow it, then THAT is the problem.
Posted 28 September 2012 - 10:03 AM
If you want to pay extra on your house, take your mortgage amount and spilt it in half and pay that amount every 2 weeks. For example, my mortgage payment is $2000 a month. I pay $1000 every 2 weeks....will end up saving about $40,000 and paying my mortgage off about 13 yrs early
If you are going to do that, you are better off with a 15 yr mortgage....you get a lower interest rate.
However, by following your suggestion, you have the flexibility to only make the monthly payment for a few months if needed.....15 yr mortgage locks you into the higher payment.
Posted 28 September 2012 - 12:18 PM
Posted 28 September 2012 - 04:45 PM