ArkTinkerer
Full time employment: Posting here.
- Joined
- Aug 12, 2014
- Messages
- 584
Should pay off the mortgage shortly. Will be right around starting ER. Mentally, it is a big thing. We always paid more than the minimum, took out 15 or 20 year loans instead of 30, bought less house than they said we could afford, etc.
I am progressing with plans for a workshop. Due to the neighborhood (and actually for our desires and long term value as well) the shop will be the shell of a normal house so it can be converted easily at some point. Building materials are going up in cost much faster than the official CPI. Building labor for those parts I can't do myself are rising as well.
Mortgage rates are very low. Our interest payments are now small enough that we take standard deduction instead of itemizing.
I personally think interest rates/inflation have to shoot up substantially at some point. Certainly in the next 3-5 years.
So.... While it goes against everything I anticipated, I am looking very hard at taking out a new home loan going into retirement. Payments would be same as current. On paper it looks like it would actually be profitable if inflation increases to just 5% within 5 years and stocks keep pace. At inflation rates of 3% I'm really only out the points/fees for the loan. The loan will be excess to what I need for the shop so the excess would either go to mutual funds/CDs (if I can find a good rate!)/another rental property or just pay off a chunk of mortgage when the shop is complete.
Thoughts?...
I am progressing with plans for a workshop. Due to the neighborhood (and actually for our desires and long term value as well) the shop will be the shell of a normal house so it can be converted easily at some point. Building materials are going up in cost much faster than the official CPI. Building labor for those parts I can't do myself are rising as well.
Mortgage rates are very low. Our interest payments are now small enough that we take standard deduction instead of itemizing.
I personally think interest rates/inflation have to shoot up substantially at some point. Certainly in the next 3-5 years.
So.... While it goes against everything I anticipated, I am looking very hard at taking out a new home loan going into retirement. Payments would be same as current. On paper it looks like it would actually be profitable if inflation increases to just 5% within 5 years and stocks keep pace. At inflation rates of 3% I'm really only out the points/fees for the loan. The loan will be excess to what I need for the shop so the excess would either go to mutual funds/CDs (if I can find a good rate!)/another rental property or just pay off a chunk of mortgage when the shop is complete.
Thoughts?...