Andre1969
Thinks s/he gets paid by the post
Hey gang, I've run into a sort of financial crossroads, and need some advice. I've been thinking about having a new house built on my property, and having the old house torn down. The current house is just too old, too close to the road, and needs to much work to really make it worth saving, IMO. Years down the road, if I decide to sell, I'm sure whomever buys it will just tear down the existing house and garage, subdivide, and put up new houses. However, if I built a new house, my reasoning is that the land would still get subdivided, the garage would still probably get torn down, but the new house would probably get re-sold, just on a smaller parcel of land, so there would be some value there.
The problem right now, is that I probably wouldn't qualify for a mortgage to build a new house. I don't have a conventional mortgage right now, but rather an HELOC. And when rates dropped to 3.5% last year, I maxxed that sucker out and invested most of it. The investments are doing well, and I don't want to cash them in.
So right now, what I'm thinking about doing is cutting back on some of my monthly investing. I'll keep my 401k maxxed out, as well as my Roth, but cut back my after-tax investing. I figure I'll have $1000-1500 monthly to work with, and could either:
A) throw it at the mortgage to get it paid down faster
B) set it aside for a bigger down payment
C) do a little of both.
Any insight on to what would be the best way to go? As far as financial stats go, I did get the HELOC paid down to $160K, from its high of $175K. I estimate the new house could run as high as $200K. And there is no way in hell anyone's going to give me a $360,000 mortgage! Although ironically, the monthly payment on a $360K mortgage (local credit union is offering 4.38% for a 30 year fixed) would only be around $1800 per month, less than the $2000-2500 per month I plan on throwing at the current mortgage.
My first instinct is to try to pay the mortgage down, as it's not going to stay at 3.5% forever. Any thoughts?
Thanks!
-Andre
The problem right now, is that I probably wouldn't qualify for a mortgage to build a new house. I don't have a conventional mortgage right now, but rather an HELOC. And when rates dropped to 3.5% last year, I maxxed that sucker out and invested most of it. The investments are doing well, and I don't want to cash them in.
So right now, what I'm thinking about doing is cutting back on some of my monthly investing. I'll keep my 401k maxxed out, as well as my Roth, but cut back my after-tax investing. I figure I'll have $1000-1500 monthly to work with, and could either:
A) throw it at the mortgage to get it paid down faster
B) set it aside for a bigger down payment
C) do a little of both.
Any insight on to what would be the best way to go? As far as financial stats go, I did get the HELOC paid down to $160K, from its high of $175K. I estimate the new house could run as high as $200K. And there is no way in hell anyone's going to give me a $360,000 mortgage! Although ironically, the monthly payment on a $360K mortgage (local credit union is offering 4.38% for a 30 year fixed) would only be around $1800 per month, less than the $2000-2500 per month I plan on throwing at the current mortgage.
My first instinct is to try to pay the mortgage down, as it's not going to stay at 3.5% forever. Any thoughts?
Thanks!
-Andre