Sojourner
Thinks s/he gets paid by the post
- Joined
- Jan 8, 2012
- Messages
- 2,762
DW and I are mulling the idea of buying a new house sometime in 2025. Our current home is 100% owned by me (paid-off mortgage) and will be able to cover about half the cost of purchasing the new home once we sell it. In other words, the purchase price of the new home will likely be about twice the market value of our current home. I plan to pay for half the purchase price with cash I'll pull from MM funds in my brokerage accounts. The question is, what would be the ideal way to finance the other 50% of the purchase price?
I know that pledged asset lines of credit (PALOC) have been discussed around here as a good option for this kind of thing, so I'll be looking into that over the next few weeks. How do PALOCs typically compare with standard HELOCs for uses like this? What about margin loans through a brokerage? Or even just a plain old mortgage? I want to make sure I know about all the best options open to us FIREd folks and would appreciate any and all recommendations you'd care to share.
Oh, and one other question. Seeing how the interest rate environment is slowly becoming more and more favorable to borrowers, would it be prudent to "go slow" with something like a PALOC or HELOC? Maybe wait till after the next Fed move to see if I can get better rates? Or is that too much like trying to time the market?
I know that pledged asset lines of credit (PALOC) have been discussed around here as a good option for this kind of thing, so I'll be looking into that over the next few weeks. How do PALOCs typically compare with standard HELOCs for uses like this? What about margin loans through a brokerage? Or even just a plain old mortgage? I want to make sure I know about all the best options open to us FIREd folks and would appreciate any and all recommendations you'd care to share.
Oh, and one other question. Seeing how the interest rate environment is slowly becoming more and more favorable to borrowers, would it be prudent to "go slow" with something like a PALOC or HELOC? Maybe wait till after the next Fed move to see if I can get better rates? Or is that too much like trying to time the market?