RE:Real estate question... |
Subject: RE:Real estate question... by DaleD on 2008/2/10 16:49:45 Quote: But I don't see whats so bad about a 30 yr fixed in this market. I'm very conservative, so take anything I say in that context. Fixed is the only way to go if you can do it. 30 year is poison. What I did, was finance 30 year fixed, because the difference at the time was 1/4%. So I have a 30 year mortage at 5.75%. Now, paying it for 30 years would be stupid. Like redwing said, you pay the house price to the lender in 10 years, and then line their pockets the last 20. So, I pay extra. Taking random numbers, if my payment is $800/month, and I pay $1000/month, I pay that loan off in 18 years. Go here: http://www.hughchou.org/calc/missing.cgi Plug in numbers and see what happens. Buying real estate will make you money, but it's also a second job. Renters and repairs are a serious headache. The best way to think of it is, once you take on a debt, you have to pay it back. If your debt is at 6%, every dollar you owe is going to keep growing the debt at 6%. Every dollar extra you put against that loan will keep it from growing interest debt at 6%, thus EARNING you 6%. So, if you put $100 extra against a debt that you owe 6% for 20 years, it's like investing $100 in a fund that will return 6% for 20 years. |