| Thinking of buying a House |
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mukeshkkashyap
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Location: india
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You can choose the interest-only payments or if you prefer, you can find a way around PMI.
Personal Finance Planner
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Thu Nov 18, 2010 9:07 am |
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johnbothas
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If I were you I'd wait a bit more, because you might be able to buy a house in less than 18% next year today.you can buy a house now, and blocking of interest on loans for housing and student.
Complete kitchen
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Mon Feb 14, 2011 6:53 pm |
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siymenthomas
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Well every person to have his or her own house for that thinking for buying is one of the best idea. But before buying a house it is necessary for a person to know the basic information about the house which is very much necessary.
buy r4i
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Fri Nov 18, 2011 10:49 am |
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tarako
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Joined: 19 Nov 2011
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quote:
Originally posted by oldguy
quote:
We first wanted to pay off all of our student loan debt first, which we have paid down to $25,000 @ 4%interest
It doesn't make sense to prepay 4% capital and then borrow that same money back at 5% or 6% for a mortgage - why don't you retain the use of that 4% capital for the full term ?
In general, a young family with a long time horizon of wealth building should focus on putting their income stream to the highest and best use - ie, don't use it to retire low cost debt. The $25,000 invested in long term items (eg, in your 401k, your Roth accounts, a brokerage account) will be $572,000 in 30 yrs at 11% - so don't waste it on a SL. When you're young it's hard to think 30 yrs ahead - but you (and your then-30yr,5mon old daughter) will be glad that you did.
IMO you are right to buy a $150k house soon, use only 30 yr fixed rate loans (no ARMs, no balloons, no 15 yr loans, no designer loans). You will probably get a <4.5% loan - and then keep both the 4% SL and the 4.5% loan for their full terms - and focus your income on increasing your net worth.
I think the market still has a way to fall so if you can wait.
However, if you are going to buy the above is good financial advice. Not all debt is the same. It might seem strange to decide to keep a debt on when you could pay it off. But the example with the different interest rates is right.
Over longer terms it works out.
Saying that I don't know where anyone is going to get an 11% return for one year let alone 30 years on the bounce.
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Fri Nov 25, 2011 6:24 am |
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