- My Forums
- Tiger Rant
- LSU Recruiting
- SEC Rant
- Saints Talk
- Pelicans Talk
- More Sports Board
- Fantasy Sports
- Golf Board
- Soccer Board
- O-T Lounge
- Tech Board
- Home/Garden Board
- Outdoor Board
- Health/Fitness Board
- Movie/TV Board
- Book Board
- Music Board
- Political Talk
- Money Talk
- Fark Board
- Gaming Board
- Travel Board
- Food/Drink Board
- Ticket Exchange
- TD Help Board
Customize My Forums- View All Forums
- Show Left Links
- Topic Sort Options
- Trending Topics
- Recent Topics
- Active Topics
Started By
Message
re: How much to put down on a home? (more than 20%?)
Posted on 8/25/13 at 12:23 pm to ItNeverRains
Posted on 8/25/13 at 12:23 pm to ItNeverRains
quote:
Yes, every evening when I walk out my front door, cross the street, and onto my clubs 156 yard par 3, I think about how enslaved I am for the next 30 years at 3.625% no less.
I'm sure that fits your expectations now, but in 10 years, my house will be paid off - and the current mortage payment will be staying in my bank account. After those same 10 years, I don't think you'll even be to the point where you're paying more principal than interest every month.
A/B analysis of 2 $400,000 loans tells me that, even at 3.5% APR for both of them, the 15-year I pay $132k less interest than I would on the 30-year.
Sure, most people don't hold the 30-year loans to term - and that cheaper payment now means more money in my pocket now.
However, plans change and it's just tough for me to pay, in extra interest, enough money to buy an okay home where I live.
This post was edited on 8/25/13 at 12:23 pm
Posted on 8/25/13 at 12:40 pm to Ace Midnight
quote:If you run those numbers as tax deductible, in the face of 7% inflation, with 10% market returns and increases of 2% real estate Y2Y, the landscape changes.
A/B analysis of 2 $400,000 loans tells me that, even at 3.5% APR for both of them, the 15-year I pay $132k less interest than I would on the 30-year.
Posted on 8/25/13 at 1:11 pm to Ace Midnight
quote:
I'm sure that fits your expectations now, but in 10 years, my house will be paid off
If you pay the minimum and invest the difference, you will have more money. Never borrow when the rate is below inflation - and keep in mind that you deduct interest on a mortgage loan so a 3.5% rate before tax is closer to 2.6% after tax.
Prepaying your mortgage, therefore, is like investing in a CD for 10 years or more that doesn't even beat inflation.
Popular
Back to top
![logo](https://images.tigerdroppings.com/images/layout/TDIcon.jpg)