- This topic has 110 replies, 15 voices, and was last updated 15 years, 4 months ago by
moneymaker.
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January 15, 2009 at 11:26 AM #329820January 15, 2009 at 11:27 AM #329291
sdduuuude
Participant[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.
Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.
I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.
If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.
By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O
January 15, 2009 at 11:27 AM #329633Participant[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.
Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.
I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.
If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.
By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O
January 15, 2009 at 11:27 AM #329704Participant[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.
Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.
I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.
If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.
By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O
January 15, 2009 at 11:27 AM #329731Participant[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.
Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.
I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.
If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.
By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O
January 15, 2009 at 11:27 AM #329815Participant[quote=joestool]
The only money that is double taxed is the extra amount of post tax money you are additionally paying back as interest to yourself. That extra amount of interest is paid back into your 401k to compound tax free until distribution.
[/quote]Can’t you write off the interest paid as a tax deduction? This means, you deduct the interest at today’s tax rate, but pay deferred tax on it when you take it out, thus negating any double-taxing.
Cool thread. Interesting question. This sounds like an interesting way to get a fair return on your both your IRA investments and your mortgage.
I’m wondering if I can use a 20% interest rate to get more tax-deferred money into my IRA.
If you default on your own loan, can you foreclose and put the house in the IRA? Really – this is a fascinating topic.
By the way – is that Joe’s tool or Joe Stool ? I can’t say either are attractive usernames :O
January 15, 2009 at 12:17 PM #329336poway_seller
ParticipantThe main premise of the argument is that by getting the loan to a Conforming Rate she will be able to save 1% on the loan.
“If she uses this 40k to bring down her loan to the confirming loan range and brings her rate from about 6% to 5%”
If this means getting it to below $546,250 in San Diego county from a Jumbo, then YES, 1% or more is likely correct.
However…
If this means she is trying to take the loan from $457,000 to $417,000… then the argument is NOT as valid as at $457 (up to $526.25k) one can do a “jumbo conforming” for what has recently been roughly 0.25% higher than the regular conforming loan. So a savings of only .25% is in question, and that may not be worth borrowing from the 401k for.
January 15, 2009 at 12:17 PM #329678ParticipantThe main premise of the argument is that by getting the loan to a Conforming Rate she will be able to save 1% on the loan.
“If she uses this 40k to bring down her loan to the confirming loan range and brings her rate from about 6% to 5%”
If this means getting it to below $546,250 in San Diego county from a Jumbo, then YES, 1% or more is likely correct.
However…
If this means she is trying to take the loan from $457,000 to $417,000… then the argument is NOT as valid as at $457 (up to $526.25k) one can do a “jumbo conforming” for what has recently been roughly 0.25% higher than the regular conforming loan. So a savings of only .25% is in question, and that may not be worth borrowing from the 401k for.
January 15, 2009 at 12:17 PM #329749ParticipantThe main premise of the argument is that by getting the loan to a Conforming Rate she will be able to save 1% on the loan.
“If she uses this 40k to bring down her loan to the confirming loan range and brings her rate from about 6% to 5%”
If this means getting it to below $546,250 in San Diego county from a Jumbo, then YES, 1% or more is likely correct.
However…
If this means she is trying to take the loan from $457,000 to $417,000… then the argument is NOT as valid as at $457 (up to $526.25k) one can do a “jumbo conforming” for what has recently been roughly 0.25% higher than the regular conforming loan. So a savings of only .25% is in question, and that may not be worth borrowing from the 401k for.
January 15, 2009 at 12:17 PM #329776ParticipantThe main premise of the argument is that by getting the loan to a Conforming Rate she will be able to save 1% on the loan.
“If she uses this 40k to bring down her loan to the confirming loan range and brings her rate from about 6% to 5%”
If this means getting it to below $546,250 in San Diego county from a Jumbo, then YES, 1% or more is likely correct.
However…
If this means she is trying to take the loan from $457,000 to $417,000… then the argument is NOT as valid as at $457 (up to $526.25k) one can do a “jumbo conforming” for what has recently been roughly 0.25% higher than the regular conforming loan. So a savings of only .25% is in question, and that may not be worth borrowing from the 401k for.
January 15, 2009 at 12:17 PM #329860ParticipantThe main premise of the argument is that by getting the loan to a Conforming Rate she will be able to save 1% on the loan.
“If she uses this 40k to bring down her loan to the confirming loan range and brings her rate from about 6% to 5%”
If this means getting it to below $546,250 in San Diego county from a Jumbo, then YES, 1% or more is likely correct.
However…
If this means she is trying to take the loan from $457,000 to $417,000… then the argument is NOT as valid as at $457 (up to $526.25k) one can do a “jumbo conforming” for what has recently been roughly 0.25% higher than the regular conforming loan. So a savings of only .25% is in question, and that may not be worth borrowing from the 401k for.
January 15, 2009 at 5:12 PM #329558NicMM
ParticipantYes, she is trying to get it to below $546,250 in San Diego county from a Jumbo.
January 15, 2009 at 5:12 PM #329897ParticipantYes, she is trying to get it to below $546,250 in San Diego county from a Jumbo.
January 15, 2009 at 5:12 PM #329970ParticipantYes, she is trying to get it to below $546,250 in San Diego county from a Jumbo.
January 15, 2009 at 5:12 PM #329997ParticipantYes, she is trying to get it to below $546,250 in San Diego county from a Jumbo.
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