Small Mortgage |
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 Jul 31 2008, 12:22 PM
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#1
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 Gedoles Hador  Group: Members Posts: 9,141 Joined: 26-May 05 Member No.: 1,532  |
If one is looking to get a small mortgage, is it better to get a 30-year fixed and overpay in general, or to get a 15-year fixed and be forced to pay more each month?
What are the pros/cons? -------------------- Many people wish they could change their life, when all they really need to do is change their attitude towards life. - Sharon
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Jul 31 2008, 12:24 PM
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#2
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 hombre salvaje Group: Members Posts: 5,498 Joined: 10-November 05 Member No.: 1,994 |
QUOTE (FYI @ Jul 31 2008, 01:22 PM)  If one is looking to get a small mortgage, is it better to get a 30-year fixed and overpay in general, or to get a 15-year fixed and be forced to pay more each month? What are the pros/cons? If you can afford the monthly pmt on the 15 year, you'd be paying a lot less over the life of the loan in interest -------------------- My dog doesn't lick his own butt. He doesn't eat poop or step in it. I'll concede that he does smell other dogs' butts and he does lick "himself." I'd prefer it if he doesn't lick me right after that, so I employ a few minutes of buffer time between licking other things and me and I try to get him to drink some water too. - VLG
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Jul 31 2008, 12:25 PM
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#3
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 The REAL Adiel Group: Members Posts: 6,337 Joined: 16-May 03 Member No.: 63 |
QUOTE (FYI @ Jul 31 2008, 01:22 PM) If one is looking to get a small mortgage, is it better to get a 30-year fixed and overpay in general, or to get a 15-year fixed and be forced to pay more each month? What are the pros/cons? If you can afford it go for the 15, it's like a savings plan that forces you to contribute more each year. -------------------- |
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Jul 31 2008, 12:31 PM
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#4
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Gedoles Hador Group: Members Posts: 9,141 Joined: 26-May 05 Member No.: 1,532 |
QUOTE (Psychodad @ Jul 31 2008, 12:24 PM) If you can afford the monthly pmt on the 15 year, you'd be paying a lot less over the life of the loan in interest QUOTE (the Real Adiel @ Jul 31 2008, 12:25 PM) If you can afford it go for the 15, it's like a savings plan that forces you to contribute more each year. Let's say you can afford a 15-year but it would be cutting close. A 30-year would give you more wiggle room so that if you couldn't pay a month or so any extra that you would still be okay? -------------------- Many people wish they could change their life, when all they really need to do is change their attitude towards life. - Sharon
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Jul 31 2008, 12:34 PM
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#5
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hombre salvaje Group: Members Posts: 5,498 Joined: 10-November 05 Member No.: 1,994 |
QUOTE (FYI @ Jul 31 2008, 01:31 PM) Let's say you can afford a 15-year but it would be cutting close. A 30-year would give you more wiggle room so that if you couldn't pay a month or so any extra that you would still be okay? better to not cut it close. You can't count on your other expenses maintaining an steady rate considering the rate of inflation these days. Not to mention unforseen circumstances that could pop up (or out) -------------------- My dog doesn't lick his own butt. He doesn't eat poop or step in it. I'll concede that he does smell other dogs' butts and he does lick "himself." I'd prefer it if he doesn't lick me right after that, so I employ a few minutes of buffer time between licking other things and me and I try to get him to drink some water too. - VLG
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Jul 31 2008, 12:34 PM
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#6
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The REAL Adiel Group: Members Posts: 6,337 Joined: 16-May 03 Member No.: 63 |
QUOTE (FYI @ Jul 31 2008, 01:31 PM) Let's say you can afford a 15-year but it would be cutting close. A 30-year would give you more wiggle room so that if you couldn't pay a month or so any extra that you would still be okay? Go for the 15, better stretch and force yourself to live cheap and pay off the loan in less time. That way when it's time to make a chasunuh for your first kid you'll be able to take out a second mortgage on a house that's already paid off. -------------------- |
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Jul 31 2008, 12:35 PM
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#7
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hombre salvaje Group: Members Posts: 5,498 Joined: 10-November 05 Member No.: 1,994 |
QUOTE (the Real Adiel @ Jul 31 2008, 01:34 PM) Go for the 15, better stretch and force yourself to live cheap and pay off the loan in less time. That way when it's time to make a chasunuh for your first kid you'll be able to take out a second mortgage on a house that's already paid off. terrible advice.... -------------------- My dog doesn't lick his own butt. He doesn't eat poop or step in it. I'll concede that he does smell other dogs' butts and he does lick "himself." I'd prefer it if he doesn't lick me right after that, so I employ a few minutes of buffer time between licking other things and me and I try to get him to drink some water too. - VLG
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Jul 31 2008, 12:35 PM
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#8
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The REAL Adiel Group: Members Posts: 6,337 Joined: 16-May 03 Member No.: 63 |
QUOTE (Psychodad @ Jul 31 2008, 01:34 PM) better to not cut it close. You can't count on your other expenses maintaining an steady rate considering the rate of inflation these days. Not to mention unforseen circumstances that could pop up (or out) With inflation also comes salary rises (delayed but they come eventually) Since a mortgage is fixed you'll come out ahead if inflation accelerates. -------------------- |
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Jul 31 2008, 12:36 PM
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#9
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 Rebbe  Group: Members Posts: 1,487 Joined: 20-April 05 Member No.: 1,434 |
QUOTE (FYI @ Jul 31 2008, 01:31 PM) Let's say you can afford a 15-year but it would be cutting close. A 30-year would give you more wiggle room so that if you couldn't pay a month or so any extra that you would still be okay? Depends how well you will sleep at night -------------------- "I dont know Art, but I know pictures"
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Jul 31 2008, 12:37 PM
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#10
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Gedoles Hador Group: Members Posts: 9,141 Joined: 26-May 05 Member No.: 1,532 |
QUOTE (Knowwon @ Jul 31 2008, 12:36 PM) Depends how well you will sleep at night What does my sleep have anything to do with a mortgage? -------------------- Many people wish they could change their life, when all they really need to do is change their attitude towards life. - Sharon
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Jul 31 2008, 12:38 PM
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#11
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hombre salvaje Group: Members Posts: 5,498 Joined: 10-November 05 Member No.: 1,994 |
QUOTE (the Real Adiel @ Jul 31 2008, 01:35 PM) With inflation also comes salary rises (delayed but they come eventually) Since a mortgage is fixed you'll come out ahead if inflation accelerates. salaries don't always keep up with inflation and it's definitely not something one should count on. What happens if they can't make payment becuase expenses increase at a higher rate than salary increases. Why create such a risk? -------------------- My dog doesn't lick his own butt. He doesn't eat poop or step in it. I'll concede that he does smell other dogs' butts and he does lick "himself." I'd prefer it if he doesn't lick me right after that, so I employ a few minutes of buffer time between licking other things and me and I try to get him to drink some water too. - VLG
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Jul 31 2008, 12:45 PM
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#12
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The REAL Adiel Group: Members Posts: 6,337 Joined: 16-May 03 Member No.: 63 |
QUOTE (Psychodad @ Jul 31 2008, 01:38 PM) salaries don't always keep up with inflation and it's definitely not something one should count on. What happens if they can't make payment becuase expenses increase at a higher rate than salary increases. Why create such a risk? I always feel that people can reduce expenses when they really need to (barring big jolts like losing a job) -------------------- |
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Jul 31 2008, 12:49 PM
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#13
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 Mr. Garrison is back! Group: Members Posts: 5,222 Joined: 20-April 05 From: Omicron-Persei 9 Member No.: 1,432 |
QUOTE (the Real Adiel @ Jul 31 2008, 01:34 PM) Go for the 15, better stretch and force yourself to live cheap and pay off the loan in less time. That way when it's time to make a chasunuh for your first kid you'll be able to take out a second mortgage on a house that's already paid off. Why not take the 30 yr and make payments like it was a 15 yr (overpay each month)? Wouldn't you come out the same in the end and if there are times when they can't make the extra payment, at least they are not obligated for it? Whoa - people take out 2nd mortgages to pay for their kid's wedding?!?! -------------------- Nothing, I have nothing to say.
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Jul 31 2008, 12:49 PM
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#14
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hombre salvaje Group: Members Posts: 5,498 Joined: 10-November 05 Member No.: 1,994 |
QUOTE (the Real Adiel @ Jul 31 2008, 01:45 PM) I always feel that people can reduce expenses when they really need to (barring big jolts like losing a job) Right, some people can, some can't. How do you know FYI doesn't already lead a frugal lifestyle? Giving blanket advice that cutting it close is okay and assuming they have the ability and desire to change their lifestyle is reckless. -------------------- My dog doesn't lick his own butt. He doesn't eat poop or step in it. I'll concede that he does smell other dogs' butts and he does lick "himself." I'd prefer it if he doesn't lick me right after that, so I employ a few minutes of buffer time between licking other things and me and I try to get him to drink some water too. - VLG
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Jul 31 2008, 01:04 PM
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#15
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 Newbie Emeritus Group: Members Posts: 6,257 Joined: 27-September 04 From: Earth Member No.: 710 |
QUOTE (FYI @ Jul 31 2008, 01:22 PM) If one is looking to get a small mortgage, is it better to get a 30-year fixed and overpay in general, or to get a 15-year fixed and be forced to pay more each month? What are the pros/cons? It is impossible to answer that meaningfully without being given additional information such as your income, expenses, and alternative investment opportunities. -------------------- Do you love the IRS? If so please do NOT support the FairTax proposal!
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Jul 31 2008, 01:49 PM
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#16
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Gedoles Hador Group: Members Posts: 9,141 Joined: 26-May 05 Member No.: 1,532 |
QUOTE (Pure Myrrh @ Jul 31 2008, 01:04 PM) It is impossible to answer that meaningfully without being given additional information such as your income, expenses, and alternative investment opportunities. Why should that make a difference? -------------------- Many people wish they could change their life, when all they really need to do is change their attitude towards life. - Sharon
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