Sup, Beeberz? I searched a bit on this, but my question is a bit different than a few I came across. Pretty sure I know the answer, but I must defer to the knowledge base on here. My current mortgage for Mi Casa en Mi Barrio in Roswell is $944, I throw $1000/month. Under Past Payment Breakdown: Principal ea month is $760 Interest ea month is $240 Under Explanation of amount due: Principal $850 Interest $90 I'm not real sure why the difference between the two. Outstanding Principal Balance is $55,000 I have the ability to payoff the mortgage tomorrow, but not real sure that is the best way to go. Even stupiderer question - Is there a way to wrangle that $ amount DOWN when throwing a huge chunk to the lien holder - (BB&T)? THE reason I have NOT paid it off is IF errtahng goes to shit, I'd rather have 55k worth of "supplies", as opposed to a house that is technically owned by the bank. Reasonable? Rational? Who TF knows... I plan to move out after a mild refurb, and have it as a rental, which should bring $1500/month, so by NOT paying off would be $500 rental income. Thanks in advance to those in the know!
I'm FAR from as financially savvy as some of the experts in here, but they generally usually say if you can use your 55k to earn you more money Investing it then you should do that instead of paying the house off. Plus with mortgage interest being tax deductible maybe you'd want to keep that benefit? I'm sure your goals and where you are related to retirement age, etc play into it as well. That said, I'm the opposite. I got saddled with quite a bit of debt after my divorce and it absolutely keeps me up at night. I'm done paying child support in a few months and while the idea of making it rain in every strip club in town and buying a new vette sounds kickass, I'm just going to buy a used R1 and get to work paying that shit off, including my house. I can't stand it.
If he's got that much of his payment going to principal he's likely towards the latter part of the loan.
4.24 % Maybe 6 years left? I'm not savvy enough to be in the stock market, so not really caring about traditional investing. I have a 401k @ work which performs "Ehh"- "OK-ish" ... set to fairly low risk I buy and sell stuff all the time, and do way better than The Dow
Thrak - You isn't feelin' me right - The point being I'd rather have 55k worth of guns n' shit, than the deed in my name and no supplies...
What supplies do you need that cost that much? Personally, I'd rather have a paid off house than some guns.
Paying off your loan is, in one sense, an investment - negation of a negative is a positive. You're unlikely to find an easy (for being non-savvy), reliable and non-risky investment that'll make you more than 4.24% APR. Good mutual funds and such will beat that fairly reliably, but you're still taking on some risk and you have to do the work to find a good one and pay the managers etc. On your home loan it sounds like you've got in the ballpark of about ten thousand dollars left of interest remaining. If you paid the loan off now, (presuming you didn't get fucked in your loan fine print re: early repayment), you'd pay only that $55k principal, saving yourself $10k. If you think you can invest your payoff money in something and make $10k of profit in six years, invest it. If having a few more toys is worth ten grand (OVER the price of the toys) to you, go play But if it were me I'd pay it off.
Mortgage payoff rule of the 78s' listed as Past Payments When you make an early payoff the the past payments are used to give the lender more money & you less money :wow: http://www.hughcalc.org/rule78.cgi
