Home loan question - 20% down or FHA????

[bruceb58]

Re: Home loan question - 20% down or FHA????

In todays world many people will not be able to pay off every dime they owe before they die.

That may be true but it isn't my goal. I don't want to be paying a bank interest. If there comes a time in my later years that I need the equity in my house to move down into something small for retirement or pay to have someone take care of me, I will have it. In the process, I will have saved 10s of thousands of dollars of interest to a bank.

I personally don't need a bigger house. I already have a 3K square foot house in which I live in by myself. I will use the money that I would otherwise be spending on a larger mortgage to fund my retirement so I can retire early. I have 2 other houses that are rentals that I will also pay off so that I have a steady income stream after I retire as well. Its all how you do your financial planning. The housing market in the US has forever changed. There are no guarantees that a house you buy now will go up and buying a personal residence solely as a financial investment is as risky as any investment. Ask anyone who bought houses in the last 7 years that question.

 

[JRgt205]

Re: Home loan question - 20% down or FHA????

FHA makes you have 2 years of taxes in escrow at closing.
You must keep your fha loan for at least one year.
Avoid FHA if you can help it.

 

[Kiwi Phil]

Re: Home loan question - 20% down or FHA????

Makes zero sense to me! My parents haven't had a house payment for 20 years. Trust me, they are glad they don't. Your logic would have them refi the house take money out of it and resume a loan? I assume you like having car payments too?

I'm with you Bruce.
I'm mortgage free for over 30yrs.
Ran some simple figures.
Had I had a mortgage for only $200 week equivalent to todays money, ($10,000 yr), it would have cost me equivalent to $300,000 over 30 years.

People miss, to have $10,000 yr mortgage payments, you need $13,000 income, less 25% income tax, to = $10,000.

I would do what Dingbats done, (high % equity, ability to service debt, attractive interest rates, very low prices, making the $8-10K write off is a bonus). But as you say Bruce, doing it for the sake of a write off is economic stupidity.

I can't agree with your thinking rivermouse. Personally I'd forget the kids inheritance and get the overheads way down so I would have more in my pocket now.
They say rent is dead money but it has nothing on interest.

Cheers
Phillip