What would you do? Mortgage question? - Page 2

ember15 · 06-05-2008, 08:57 AM

I am agreeing with the 30 year idea it offers more flexablity. Keep in mind Morgage interest is also a tax right off so if you have to pay more you can write off more. I would like keeping things as loose as possible so you have extra to go toward retirement, vacations, emergency fund etc. Having extra wiggle room means you have more money to work with. In my mind thats a big plus.

Thriftygal · 06-05-2008, 01:35 PM

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

I totally agree with Calimari, especially with the way the economy is right now. You can pay the difference of the 15 year payment and the 30 year payment on the principle each month. You can use this calculater to help you figure out the difference in interest paid between the 15 yr and the 30 yr with extra principle payments: Mortgage Calculator -- Bankrate.com

stacia · 06-05-2008, 01:44 PM

I'm a Realtor and my dad is in the Mortgage business. He always recommends going with a traditional 30 year loan and just paying extra in principle either every month or just when you can. That way if ever an emergency happens you aren't stretched too thin.

brensmom · 06-05-2008, 02:32 PM

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

i agree with calimari any mortgage i have ever had there is a spot to pay extra on principal just put what you want. we pay 1 to 2 extra payments a year on principal it very easy you can either divide it out over 12 months or make a couple lump sum principal payments.. this way if you do run into a situation you will have the extra cash you need.

beachlovinmommy · 06-06-2008, 09:13 PM

My best suggestion would be to take the 30yr mortgage but set yourself up for bi-weekly payments. This will pay off your mortgage in 17 years as opposed to 30yrs for the same amount of $ out of your pocket every month. If you look at an amortization schedule you can really see how this impacts your principle amount over time. Say your mortgage is $2,000/mth you would just pay $1,000 every 2 weeks to the mortgage company instead of one large check. Also, if you needed to you could always refinance later and have already made a large dent in the principle amount that you owe or make a larger profit from the sale. Hope this helps you out. Just check with your lender to see if they offer the option. You shouldn't need to pay a service to do this for you as banks are usually very accomodating to setting up automatic payment plans.

Thriftygal · 06-06-2008, 11:06 PM

Quote:

Originally Posted by beachlovinmommy

My best suggestion would be to take the 30yr mortgage but set yourself up for bi-weekly payments.

We did this with Citibank, and we immediately saw a difference on our principle each month. I know Wells Fargo offers this too. Most of the time they will draft the payment after you get paid(we got paid on Thurs, and they drafted the following Monday), so it helps with budgeting.

Kim · 06-07-2008, 07:48 AM

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

This gives you more flexibility and "insurance" for those times when money is tight. You can still pay it off in 15 years if you choose to do so.

2bearsmom · 06-07-2008, 08:01 AM

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

I could not agree more! And if you do decide to be set up for bi-weekly payments..DO IT YOURSELF. DO not let them set it up for you for a fee. Just send in the extra payments yourself (But sometimes you must specify on the payment that it is to be applied towards principle, my mom learned this when she didn't specify some extra $$ in a payment payment and they put it to interest

).

T-shell · 06-09-2008, 10:51 AM

Quote:

Originally Posted by 2bearsmom

I could not agree more! And if you do decide to be set up for bi-weekly payments..DO IT YOURSELF. DO not let them set it up for you for a fee. Just send in the extra payments yourself (But sometimes you must specify on the payment that it is to be applied towards principle, my mom learned this when she didn't specify some extra $$ in a payment payment and they put it to interest

).

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

I agree with going for the 30 or 20 year loan and making extra payments when you can. As far as the bi-weekly payment plans go, yes they can save you money, but if your employment situation changes (pay frequency change too), then having to pay 1/2 the mortgage payment bi-weekly can throw your budget for a loop.

LawDawg · 06-09-2008, 09:24 PM

Quote:

Originally Posted by calimari

I'd go with the 30 and simply pay extra on my principal when I had the money and, if I didn't have the money, pay the normal amount. You can create your own 15/20/25 year loan that way, but you don't get "stuck" if something happens w/ the job.

Exactly -- sure things are great now but it could change this way you are not forced to refinance later if that should happen but you could still pay it off in 15 years!! Just make those larger payments now.