The lenders who lend based on ‘projected’ income stream usually do not lend fixed for 30yrs AND rates are considerably higher than ‘real’ 30yr fixed rates today. What are the rates & term ?
When it’s adjustable or short term the risk is on the borrower.
5% vs 3.50% is 43% higher which is a HUGE margin.
With $200K of debt, you have to give up $200K of cash to pay it off.
This is not a simple matter of right/wrong but what an individual is comfortable with. There is always some risk involved.
Having no mortgage comes at a cost. The lost opportunity of that cash. It’s foolish to think otherwise.
I have seen too many older people who have lots of equity but very little cash. They are NOT enjoying their lives. Reverse mortgages are expensive.
There is nothing wrong with manageable debt.
I have had responsible people tell me that they sleep much better with money in the bank than they did when they had a high mortgage payment and no cash cushion.
Having cash gives you options. Having lots of equity limits your options. The system makes me sick. It’s broken & manipulated.
It’s ridiculous/idiotic that people with $1 million dollar homes cannot qualify for $200K GSE loans at 3.50%
Obviously not available today, but what if CD rates were 6%+ and the interest stream paid the full payment on an amortized mortgage ?
