Comments on: Your Mortgage: When 30 beats 15 http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/ Helping People Find, Keep and Enjoy Their Money Tue, 20 Dec 2011 16:21:36 +0000 hourly 1 http://wordpress.org/?v= By: Full Picture of Mortgage Acceleration http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-672 Full Picture of Mortgage Acceleration Wed, 21 Apr 2010 18:49:16 +0000 http://evolutionofwealth.com/?p=244#comment-672 [...] This is where I see a lot of people get surprised.  People assume that since the mortgage is paid off and Elle would be putting away almost 5 times as much money that it has to be better to pay off the mortgage and then save the difference.  When you look at it over a 30 year period it’s because of the head start the money on the side gets.  You might find out that that 30-year mortgage can beat a 20 or even a 15-year mortgage. [...] [...] This is where I see a lot of people get surprised.  People assume that since the mortgage is paid off and Elle would be putting away almost 5 times as much money that it has to be better to pay off the mortgage and then save the difference.  When you look at it over a 30 year period it’s because of the head start the money on the side gets.  You might find out that that 30-year mortgage can beat a 20 or even a 15-year mortgage. [...]

]]> By: Investor Junkie http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-249 Investor Junkie Sat, 12 Dec 2009 03:42:11 +0000 http://evolutionofwealth.com/?p=244#comment-249 You also didn't mention inflation as another reason to go with a longer term loan. My true interest rate of our house is 3.26% (with tax deductions) visit this site for the calculation http://www.bankrate.com/calculators/mortgages/loan-tax-deduction-calculator.aspx Inflation over the past 30 years also happens to be 3.26%, so it's almost an interest free loan. .-= Investor Junkie´s last blog ..<a href="http://feedproxy.google.com/~r/investorjunkie/~3/INQpXzoJzTQ/why-buying-a-timeshare-is-a-bad-idea" rel="nofollow">Why Buying a Timeshare is a Bad Idea</a> =-. You also didn’t mention inflation as another reason to go with a longer term loan. My true interest rate of our house is 3.26% (with tax deductions) visit this site for the calculation

http://www.bankrate.com/calculators/mortgages/loan-tax-deduction-calculator.aspx

Inflation over the past 30 years also happens to be 3.26%, so it’s almost an interest free loan.
.-= Investor Junkie´s last blog ..Why Buying a Timeshare is a Bad Idea =-.

]]> By: Evolution Of Wealth http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-223 Evolution Of Wealth Wed, 02 Dec 2009 13:59:37 +0000 http://evolutionofwealth.com/?p=244#comment-223 You make some great points and thank you for the comment. One thing I purposely didn't mention is where to put the "savings". Too many people think you just invest it, unfortunately I can't necessarily recommend that. This is money that you are going to need and investing it can be risky. The problem with a 401k is liquidity. A key to using the 30 year mortgage is to have increased liquidity in case life happens. Don't get me wrong maxing out a 401k can be great when done properly. It shouldn't be your first goal though. You make some great points and thank you for the comment. One thing I purposely didn’t mention is where to put the “savings”. Too many people think you just invest it, unfortunately I can’t necessarily recommend that. This is money that you are going to need and investing it can be risky. The problem with a 401k is liquidity. A key to using the 30 year mortgage is to have increased liquidity in case life happens.
Don’t get me wrong maxing out a 401k can be great when done properly. It shouldn’t be your first goal though.

]]> By: LAL http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-216 LAL Tue, 01 Dec 2009 22:52:58 +0000 http://evolutionofwealth.com/?p=244#comment-216 30 year fixed usually will free up money to invest in a Roth IRA and 401k. If you aren't maxing out both retirement vehicles then you are losing the tax break usually 15-25% at least which is much more than the 6% interest. Plus with retirement accounts if you don't max it out, you can never go back. The interest saved on taxes from a 401k more than pays for the difference. Use the 15 and 30 year difference to max out a 401k. We might be able to afford a 15 year fixed if we didn't max out my DH's 401k. 30 year fixed usually will free up money to invest in a Roth IRA and 401k. If you aren’t maxing out both retirement vehicles then you are losing the tax break usually 15-25% at least which is much more than the 6% interest.

Plus with retirement accounts if you don’t max it out, you can never go back. The interest saved on taxes from a 401k more than pays for the difference. Use the 15 and 30 year difference to max out a 401k.

We might be able to afford a 15 year fixed if we didn’t max out my DH’s 401k.

]]> By: Evolution Of Wealth http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-74 Evolution Of Wealth Sat, 21 Nov 2009 03:18:00 +0000 http://evolutionofwealth.com/?p=244#comment-74 @crispy If you want to talk more about your specific situation feel free to e-mail me at: evolutionofwealth@rocketmail.com. I definitely have more questions for you if you would like some real answers. First off the spread between the 15 and 30 year rates is too big. Second, if you are seriously weighing the option it becomes important how you save the difference in payments. @crispy If you want to talk more about your specific situation feel free to e-mail me at: evolutionofwealth@rocketmail.com. I definitely have more questions for you if you would like some real answers. First off the spread between the 15 and 30 year rates is too big. Second, if you are seriously weighing the option it becomes important how you save the difference in payments.

]]> By: crispy http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-73 crispy Thu, 15 Oct 2009 17:58:06 +0000 http://evolutionofwealth.com/?p=244#comment-73 Hi Evo, noted your comment to me on @bostongal. I went to 15 from 30 (w/extra cap each mo.). Thanks. I haven't run #'s, but have 2 points to offer: 1. My note is for $155k. 30 was @5.875%, 15 is at 4.375%. Not sure how that skews the analysis, esp. the amount. The delta is diminished, so I suppose the 15 looks better, but need to think about it. 2. The decision to stay 30 is also when considering driving up savings #'s. We have enough cash to pay off note completely, so I feel the worry over the payment delta if something bad happens is lessened quite a bit. I'd love to hear your thoughts. crispy Hi Evo, noted your comment to me on @bostongal. I went to 15 from 30 (w/extra cap each mo.). Thanks. I haven’t run #’s, but have 2 points to offer:

1. My note is for $155k. 30 was @5.875%, 15 is at 4.375%. Not sure how that skews the analysis, esp. the amount. The delta is diminished, so I suppose the 15 looks better, but need to think about it.
2. The decision to stay 30 is also when considering driving up savings #’s. We have enough cash to pay off note completely, so I feel the worry over the payment delta if something bad happens is lessened quite a bit.

I’d love to hear your thoughts.
crispy

]]> By: rick carrier http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-72 rick carrier Fri, 09 Oct 2009 21:07:48 +0000 http://evolutionofwealth.com/?p=244#comment-72 I found this information very interesting and I am looking forward to more posts! I found this information very interesting and I am looking forward to more posts!

]]> By: Romase http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-71 Romase Sat, 03 Oct 2009 23:48:09 +0000 http://evolutionofwealth.com/?p=244#comment-71 site best site best

]]> By: Globals http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-70 Globals Sat, 03 Oct 2009 01:17:47 +0000 http://evolutionofwealth.com/?p=244#comment-70 all good things all good things

]]> By: Evolution Of Wealth http://evolutionofwealth.com/2009/09/your-mortgage-when-30-beats-15/comment-page-1/#comment-69 Evolution Of Wealth Sat, 19 Sep 2009 13:56:53 +0000 http://evolutionofwealth.com/?p=244#comment-69 Betty: It's true that most people don't have the disclipline. The idea for this post is targetted at the people who are considering a 15-year mortgage. I'm guessing they might have more discipline when it comes to saving the difference because they can afford to. Then as I wrote this I thought it was a great way to get people thinking outside the box. I want to open people up to different and better ways to do thing. Thank you for reading and your great comments. E of W Betty:

It’s true that most people don’t have the disclipline. The idea for this post is targetted at the people who are considering a 15-year mortgage. I’m guessing they might have more discipline when it comes to saving the difference because they can afford to. Then as I wrote this I thought it was a great way to get people thinking outside the box. I want to open people up to different and better ways to do thing. Thank you for reading and your great comments.

E of W

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