View Poll Results: Why do have or dont have a mortgage
|
More invested money working for me
|
|
30 |
24.19% |
I have an income to pay the mortgage
|
|
26 |
20.97% |
Fixed income investments are paying lousy
|
|
6 |
4.84% |
Reduced withdrawal rate
|
|
7 |
5.65% |
If we have a big downturn, I wont have to pay a big mortgage bill every month
|
|
12 |
9.68% |
Have one to provide tax advantages
|
|
16 |
12.90% |
Dont have one to provide tax advantages
|
|
4 |
3.23% |
Property owners are crazy
|
|
0 |
0% |
I couldnt have bought a house without one
|
|
23 |
18.55% |
|
|
Reason for holding a mortgage...or not
02-18-2006, 11:31 AM
|
#1
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Reason for holding a mortgage...or not
The three primary reasons why you do or dont have a mortgage, and thank you very much for your participation. Your free hat is in the mail!
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
|
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!
Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!
You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!
|
Re: Reason for holding a mortgage...or not
02-18-2006, 11:48 AM
|
#2
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
|
Re: Reason for holding a mortgage...or not
Quote:
If we have a big downturn, I wont have to pay a big mortgage bill every month
|
What's with that?* If we have a big downturn,* how are you going to pay your property taxes?* I'm gonna use the money I did not use to pay off my mortgage*to make my monthly payment and to pay the property taxes
How many readers have a sub-5% fixed interest rate mortgage? You aren't paying extra on it are you?
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 11:50 AM
|
#3
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Mar 2003
Posts: 18,085
|
Re: Reason for holding a mortgage...or not
You left one out: I have a mortgage because I otherwise did not have the money to buy a house.
__________________
"All animals are equal, but some animals are more equal than others."
- George Orwell
Ezekiel 23:20
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 11:52 AM
|
#4
|
Recycles dryer sheets
Join Date: Jan 2005
Posts: 60
|
Re: Reason for holding a mortgage...or not
I don't have a mortgage but the reason why isn't among your list. I don't like to owe money. So I don't care whether or not it makes more sense financially to carry a mortgage on a house because I feel better being debt-free.
yko
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:02 PM
|
#5
|
Thinks s/he gets paid by the post
Join Date: Apr 2004
Posts: 1,463
|
Re: Reason for holding a mortgage...or not
Yeah, YKO's reason needs to be there to get a clear picture of people's reasoning. (IMHO).
To me it is a practical reason. Right now, while working and in higher tax bracket, I will keep the mort. for tax deduction.
The rate is 4.75, so I can earn about the same in safe investments, the tax break tips the balance toward keeping it.
If I had a 5.5 rate or higher I think I'd pay it off.
If the payments were high enough to be scary, (i.e. affecting withdrawal rate in down market, etc.) I'd pay it off, but they are only $428/mo. so it's relatively painless while still working.
Even after quitting, it adds less than $5,200 to the annual budget. I shouldn't be cutting it that close anyway.
I think the payoff decision is quite different for people with higher amounts, or higher rates.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:06 PM
|
#6
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by LOL!
What's with that? If we have a big downturn, how are you going to pay your property taxes? I'm gonna use the money I did not use to pay off my mortgage to make my monthly payment and to pay the property taxes
How many readers have a sub-5% fixed interest rate mortgage? You aren't paying extra on it are you?
|
Easy answer. If my stocks drop 50%, I dont have to take 12-25K+ a year out of that depleted portfolio to pay a mortgage every month. And if they drop 90% I can earn enough money at the quick-e mart to buy food and pay the utilities.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:06 PM
|
#7
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by brewer12345
You left one out: I have a mortgage because I otherwise did not have the money to buy a house.
|
Added.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:07 PM
|
#8
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by Yipee-Ki-O
I don't have a mortgage but the reason why isn't among your list. I don't like to owe money. So I don't care whether or not it makes more sense financially to carry a mortgage on a house because I feel better being debt-free.
yko
|
I captured that in one of the other polls, but good point.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:08 PM
|
#9
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by Sheryl
I think the payoff decision is quite different for people with higher amounts, or higher rates.
|
Thanks Sheryl - i'm trying to stay out of the payoff quagmire, just trying to find reasons why someone does or doesnt have it for profiling purposes.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 12:43 PM
|
#10
|
Thinks s/he gets paid by the post
Join Date: Apr 2004
Posts: 1,463
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by (Cute Fuzzy Bunny)
Thanks Sheryl - i'm trying to stay out of the payoff quagmire, just trying to find reasons why someone does or doesnt have it for profiling purposes.
|
Well, yeah,* good luck with that.*
If you don't have one, either you rent or you paid it off.*
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 01:05 PM
|
#11
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jun 2005
Posts: 10,252
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by Sheryl
...
If I had a 5.5 rate or higher I think I'd pay it off.
...
|
If prevailing CD rates were 6% would you still think that?
A reason I ask is that a couple years ago when prevailing CD rates were 3% and mortgage rates 4.5%, folks would say "Why pay 4.5% when you are earning 3%?" and look at where rates went.
Many folks believe that Bernanke et al will continue to raise rates, so CD rates will be going up.
You got to plan ahead.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 01:18 PM
|
#12
|
Thinks s/he gets paid by the post
Join Date: Apr 2004
Posts: 1,463
|
Re: Reason for holding a mortgage...or not
Quote:
Originally Posted by LOL!
If prevailing CD rates were 6% would you still think that?*
You got to plan ahead.
|
No, I wouldn't think that, and I agree with your point that you need to plan ahead. Again, its all about personal situation, and constantly reevaluating your position given current conditions and what your crystal ball says.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 01:21 PM
|
#13
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,708
|
Re: Reason for holding a mortgage...or not
Just looking for the reasons here, not a debate on whether they make sense.
Please.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 01:27 PM
|
#14
|
Moderator Emeritus
Join Date: Dec 2002
Location: Oahu
Posts: 26,856
|
Re: Reason for holding a mortgage...or not
We have a 5.375% 30-year mortgage with NFCU (now only available at 5.875%), and this week they raised their seven-year CD to 5.5%.
__________________
*
Co-author (with my daughter) of “Raising Your Money-Savvy Family For Next Generation Financial Independence.”
Author of the book written on E-R.org: "The Military Guide to Financial Independence and Retirement."
I don't spend much time here— please send a PM.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 03:36 PM
|
#15
|
Thinks s/he gets paid by the post
Join Date: Dec 2002
Posts: 3,875
|
Re: Reason for holding a mortgage...or not
We have no mortgage on our house in Illinois, nor on the Texas condo. The Number One reason, honestly, is to protect me from myself. I see "deals" everywhere and many many ways to
"invest" the money locked up in our homes. Psychologically, living with no mortgage is what works for me. My folks recently deeded
over their house to me and my brother. No mortgage there
either. Taking all three (3) properties, it's a lot of money........
close to half of our net worth.
JG
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 03:41 PM
|
#16
|
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2006
Location: Rio Grande Valley
Posts: 38,007
|
Re: Reason for holding a mortgage...or not
Yeah - I'm definitely one of those who paid off their mortgage, because they don't like holding any debt at all. It's more of a philosophical thing.
I don't even own a house anymore! I live in a motorhome. And I paid cash for it.
Audrey
__________________
Retired since summer 1999.
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 03:46 PM
|
#17
|
Thinks s/he gets paid by the post
Join Date: Sep 2005
Posts: 1,677
|
Re: Reason for holding a mortgage...or not
This might sound strange but my first goal in life was to pay off the mortage. When my grandmother died I wanted to purchace her/my home ( I lived with her) unfortunately those were the days that banks wouldn't give mortgages to 25 yr old single women. I went thru hell trying to get a bank to loan me the money, eventually my dad had to talk to the president of the bank he dealt with for his construction business. They gave in and wrote the mortgage for me but he told my dad the board did it as an exception because they didn't want to lose his business. My how things have changed huh? Oh and the rate I had to take was 17.5% ..yep.. that was the going rate back then no matter who you were. This summer I'm having a small party to burn copies of the mortgage and the business loan.
My next goal is to retire, hopefully before I reach 55 but who knows, maybe sooner.
__________________
Dogs aren't our whole lives, but they make our lives whole. - Roger Caras
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 04:58 PM
|
#18
|
Thinks s/he gets paid by the post
Join Date: Nov 2005
Location: North of Montana
Posts: 2,769
|
Re: Reason for holding a mortgage...or not
I'm probably a minority here but being Canadian there are no tax advantages to having a mortgage... make that few. We can't deduct mortgage interest unless we borrow to invest. I seem to have enough investments relative to the value of our house that the risk of rising rates, falling RE values aren't wort it.
Besides, I like being debt free!
__________________
There are two kinds of people in the world: those who can extrapolate conclusions from insufficient data and ..
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 05:47 PM
|
#19
|
Dryer sheet aficionado
Join Date: Jan 2005
Posts: 36
|
Re: Reason for holding a mortgage...or not
Outtahere,
I just have to ask. What year was it that you tried for a loan on your grandmothers house? Having had an experience trying to get a mortgage after a divorce at a young age, I want to know if it was just the times......
|
|
|
Re: Reason for holding a mortgage...or not
02-18-2006, 06:11 PM
|
#20
|
Thinks s/he gets paid by the post
Join Date: Sep 2005
Posts: 1,677
|
Re: Reason for holding a mortgage...or not
It was 1980, womens rights had come a long way but the stuffy old suits holding the money still had a strangle hold on things and discrimination against the female gender was still pretty rampant. I was there with my father when he went off on the bankers and he was the ONLY reason I got the mortgage and you can bet your butt I never let him down by being late or missing a payment.
__________________
Dogs aren't our whole lives, but they make our lives whole. - Roger Caras
|
|
|
|
|
Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
|
|
Thread Tools |
|
Display Modes |
Linear Mode
|
Posting Rules
|
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts
HTML code is Off
|
|
|
|
» Recent Threads
|
|
|
|
|
|
|
|
|
|
|
|
|
» Quick Links
|
|
|