Home › Forums › Financial Markets/Economics › Proof that any idiot can write a book! › The advice in the book is
The advice in the book is quite sensible, IMO.
They always lose me at ‘cheap’ interest only loans.
Spot checking bankrate: the four ‘cheapest’ no points I/Os are 30 years at 5.936%-6.058%. Shorter time frame is worse.
30 year fixed is 5.529%-5.550%.
The I/O payment on $400K loan would be $1978.67 – $2019.33 The fixed payment is $2278 – $2283. However the interest portion maxes at $1833.
So in exchange for parking a $430+ of your money in your equity, you pay an extra $150 in interest and invest $300?
Somehow I don’t think 5%, 10% or even 15% interest is going to make up my extra interest expense.
