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Viewing 9 posts - 61 through 69 (of 69 total)
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  • January 31, 2015 at 7:41 AM #782475
    Coronita
    Participant

    [quote=harvey]I personally would stress less if I had $800K liquid and $400K debt vs. $400K liquid and zero debt, especially if the cost of that debt were very low and fixed rate.

    Accounting net worth is the same – the relative value of the different scenarios are subjective.

    Different people value liquidity and opportunity cost differently. In general I think the benefits of paying off a home loan are often overstated.[/quote]

    Depends on your age, which I didn’t really get until I started to get older…

    February 4, 2015 at 5:04 AM #782622
    moneymaker
    Participant

    Wow 2.5% mortgage, I’m envious. That’s probably lower than the average car loan out there. Still ok with my 3.5%, but way to go flu.

    February 4, 2015 at 6:09 AM #782623
    Coronita
    Participant

    [quote=moneymaker]Wow 2.5% mortgage, I’m envious. That’s probably lower than the average car loan out there. Still ok with my 3.5%, but way to go flu.[/quote]

    It’s a 15year not 30. Yours is probably a 30yr Your monthly payments are probably much lower than what they would be at 15 year, so there’s a benefit there in that if you’re trying to qualify for more loans, it’s probably not going to impact you as much as it did for me with a 15 year.

    The best 30 year loan that I found at the time was around 3% for no fee/no cost, and it was just momentarily.

    You 3.5% is still pretty good. My rentals that did qualify for a 30 year cash out refi loan are around 4.25% (I took a hit for (1) rental property (2) condo and (3) loan too small. And I had to pay an $850 out of pocket cost each.

    For the one that didn’t qualify for a loan, I pulled my HELOC, which is at prime-minus .25% or 3%
    More importantly, it’s capped at 6%. Worst case scenario, at 6%, I would have a $0 cashflow on those. But hopefully, that will be paid off soon. I’ve been pulling money out of the stock market to pay off the helo, to prevent me from putting more money back into the markets. And I have RSU’s and ESPP shares that I sort of want to sell this year and not put back into the stock market too.

    Time to bring in some of the market speculation. I hate having debt. Good or bad.

    February 4, 2015 at 6:28 AM #782624
    The-Shoveler
    Participant

    i think Roubini has it right,

    he said in the face of fiscal austerity your going to end up with endless QE and very low rates for a very long time.

    So there you go, spend like drunken sailors or never stop the money printing presses.

    just kidding sort of.

    February 4, 2015 at 7:07 AM #782625
    livinincali
    Participant

    [quote=moneymaker]Wow 2.5% mortgage, I’m envious. That’s probably lower than the average car loan out there. Still ok with my 3.5%, but way to go flu.[/quote]

    You can always hope we keep getting more like Japan. A 35 year mortgage there is 1.8%

    February 4, 2015 at 8:39 AM #782628
    Coronita
    Participant

    [quote=livinincali][quote=moneymaker]Wow 2.5% mortgage, I’m envious. That’s probably lower than the average car loan out there. Still ok with my 3.5%, but way to go flu.[/quote]

    You can always hope we keep getting more like Japan. A 35 year mortgage there is 1.8%[/quote]

    35 year mortgage? I’m waiting for 50+ year mortgages…

    February 4, 2015 at 9:41 AM #782631
    livinincali
    Participant

    [quote=flu][quote=livinincali][quote=moneymaker]Wow 2.5% mortgage, I’m envious. That’s probably lower than the average car loan out there. Still ok with my 3.5%, but way to go flu.[/quote]

    You can always hope we keep getting more like Japan. A 35 year mortgage there is 1.8%[/quote]

    35 year mortgage? I’m waiting for 50+ year mortgages…[/quote]

    50 year? pfff try 100 year in Europe and Japan. Of course with the way amortization schedules work it’s pretty stupid to go much longer than 30 years. Of course the american consumer is rather stupid, give them the option and some dumbass will take it.

    http://homeguides.sfgate.com/longest-mortgage-7677.html

    February 4, 2015 at 11:44 AM #782635
    spdrun
    Participant

    30+ years isn’t going mainstream as long as QM is in place, since it requires 30 year max, fixed-rate loans.

    This being said, if a 100-year fixed product existed, and principal+interest were lower than a 30-year fixed, then it would make sense for some people. Especially if it were assumable.

    Say you’re buying investment property in a major city (NY or SF) where cap rates are low, intend to collect the income and NEVER sell, but rather pass it to your heirs. A 100-year fixed loan would make a hell of a lot of sense in that case.

    February 4, 2015 at 6:29 PM #782655
    joec
    Participant

    Sorta like car loans…

    http://www.usatoday.com/story/money/cars/2014/09/07/car-loans-long-term/15237795/

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