Anybody have experience with mortgages?
OhioGuy
at 5.25% interest, on a 10 year loan. (we live on one side)
We are in a situation where we would like to get moved to another home in
the next 12 months. In order to do this, we need to free up some $. We had
originally considered simply refinancing our mortgage to a 30 year, and
freeing up some equity at the same time - until we saw how much all the fees
added up to, and the new high interest rate we were offered.
I've done some calculations, and we need between $15,000 and $20,000 to
fix up the old furnaces in our double so that this place is in good shape to
rent when we're moved out, and so that we have enough cash to make payments
on a land contract home for about 15 months - while we make the transition
from living here to a new place, and get this one paying for itself. (we
spoke to a loan specialist at our credit union this morning, and she
suggested that a land contract might work out for us well, especially given
the number of houses presently sitting vacant)
Right now, most of our cash is being used up because we opted for a 10
year mortgage - which makes the move, and saving up any $ difficult.
We DO have about $12,000 in stocks set aside for our eventual auto costs,
when our present car wears out. I've been thinking that perhaps we should
use it to completely pay our house off? Part of me hates doing this to pay
off a 5.25% loan though - especially when I've made a 43% return over the
past 17 months on it. (MVL, BPL, then FNM & FRE) However, that's really
about the only way we could "retire" the original loan and make it so we
don't have to pay the $350 a month - at least that I can think of. (Ideas,
anyone?)
We could either get a home equity loan now for the $15 to $20K we'd need,
or else get a traditional second mortgage for that amount - a 30 year loan
should get us $15 to $20K for roughly $100 to $140 a month in payments,
right?
Then we could pay off our primary loan, and only have the $140 a month to
worry about on this property. As soon as someone moved in and started
paying rent, it would be taking care of itself.
Am I missing anything obvious here - another simple solution that might
work out better for us?
Dave
"OhioGuy" <no...@none.net> wrote in message news:g91i1m$rck$1...@aioe.org...
Do you owe more than the home is worth? If not, the most obvious solution
would be to sell the property, get a check from the buyer, and use that as a
down payment (and closing costs) on a new home.
You really don't want to be a landlord. And you can sell the current place
without putting a single penny into it. -Dave
h
"Dave" <no...@nohow.not> wrote in message
news:g91iu6$mi1$1...@registered.motzarella.org...
I wrote myself a check from my credit card when they were offering a "3.99%
until the balance is paid" option. The trick is to not use that card to
charge anything else until the balance is paid. So, I got $28k for home
improvements for a $150.00 "service fee" while paying 1.26% interest less
than my mortgage. It was just easier and cheaper than getting another loan.
It's not secured so there were no hoops to jump through, and there's no time
limit. Plus, I can just pay the minimum for a few months while I make up
that huge bite my once-yearly heating oil payment just caused!
AllEmailDeletedImmediately
"h" <tmc...@searchmachine.com> wrote in message
news:g91n6m$he8$1...@aioe.org...
but what happens when the ccc decides to just up and change the terms and
raises
your interest to 30%? they can do that you know.
Al Bundy
I question that $15-20K furnace installation. It seems absurdly high.
Why can't it be repaired? If you sell the place, you won't get half
the investment back. When you are renting, the tenant pays the
utilities.
SMS
> I wrote myself a check from my credit card when they were offering a "3.99%
> until the balance is paid" option. The trick is to not use that card to
> charge anything else until the balance is paid.
The problem with that is that you still have to make the minimum
payments, which is what he's trying to avoid.
I took advantage of a deal from Discover a few years back that was 0%
for life on no-fee balance transfers, with the caveat that after six
months you had to make two $1 (minimum) charges a month, and interest
would be charged on those, plus a late payment or not making those two
charges would end the rate deal. I stuck the $30K into a 5% CD.
Samantha Hill - remove TRASH to reply
Lou
The problem with people trying to end-run or game the system is that they
often end up putting more effort into it than they would if they just
followed the normal way of doing things, and end up with less in the end.
I'd be leery of a land contract arrangement. If the agreement is not
recorded by the seller the buyer may find himself up the well know creek.
When I got my last mortgage, one of the provisions of the mortgage agreement
was that the property was to be my primary residence. If the seller has
that sort of proviso in his mortgage, he'll be tempted to not record the
deal properly in order to prevent the lender from discovering the agreement.
The lender does find out, it could end up demanding payment in full, and if
you can't come up with the money, you'll lose everything you've put into the
property - your contract payments and the time, effort, and money expended
on any improvements you may have made.
If the seller doesn't keep up his mortgage payments/taxes, or there are
other liens on the house, you could end up losing the property if you can't
come up with the money.
My maternal grandfather was a landlord for years. While it did provide him
with an income, it was nothing great, there was endless tenant trouble, and
he spent a great deal of his "free" time taking care of the other people's
problems.
You propose taking on a new property but not being the owner for some
period, at the mercy of some unknown seller. While retaining whatever
maintenance problems come up on the old property an undetermined number of
miles away, plus possible tenant difficulties. Add in a new baby. It isn't
worth it, in my opinion. Sell the present place, buy your new dwelling the
conventional way, and get a 20-30 year mortgage to make the payments
bearable. If you find yourself flush one month, you can always prepay on
the principal (at least you can in New Jersey, check the law where you are)
and if you find that you have need of the money at times, you can fall back
to paying the normal monthly payment.
h
"SMS" <scharf...@geemail.com> wrote in message
news:bk_sk.7856$np7....@flpi149.ffdc.sbc.com...
What are you talking about? I pay usually $500/month when they only require
about $100. I'm still repaying the loan faster than my first mortgage.