01-23-2007, 07:56 PM
Yeah I actually spoke with one of our division managers on the phone to help clarify, because the long term total amounts of your mortgage are something that our loan officers usually talk to our customers about.
You're right, although the math and the reasons why don't really make sense to me. I'm going to pick up an amortization schedule from one of our loan officers to check it out.
What I did learn was that the best way to pay a mortgage is to do an interest only, and then pay towards the principle bimonthly. Interest is calculated on your remaining priciple on a daily basis, so this minimizes the long-term impact of interest on the amount you're paying out for your house. I also learned that if you pay just one extra monthly principle payment per year it reduces the life of your loan by like 7 years or something like that.
So, I do concede to being wrong about the interest payments. I know, I know.. even champions among men can be fallible
As far as return on investment, if you actually are paying for your house for 30 years, you can't really consider it a great investment. If you're living in it for that long, you're probably going to stay in it. It's when you live in a house for several years, build that equity, then sell it when you're going to get something in return. Which, when it all comes down to it, does not happen when you rent.
The goal is to keep doing this until you finally buy your dream house, ideally mostly in cash. Unless of course you're baller enough to do so otherwise, which I'm sure is what most of us are working towards ^_^
You're right, although the math and the reasons why don't really make sense to me. I'm going to pick up an amortization schedule from one of our loan officers to check it out.
What I did learn was that the best way to pay a mortgage is to do an interest only, and then pay towards the principle bimonthly. Interest is calculated on your remaining priciple on a daily basis, so this minimizes the long-term impact of interest on the amount you're paying out for your house. I also learned that if you pay just one extra monthly principle payment per year it reduces the life of your loan by like 7 years or something like that.
So, I do concede to being wrong about the interest payments. I know, I know.. even champions among men can be fallible
As far as return on investment, if you actually are paying for your house for 30 years, you can't really consider it a great investment. If you're living in it for that long, you're probably going to stay in it. It's when you live in a house for several years, build that equity, then sell it when you're going to get something in return. Which, when it all comes down to it, does not happen when you rent.
The goal is to keep doing this until you finally buy your dream house, ideally mostly in cash. Unless of course you're baller enough to do so otherwise, which I'm sure is what most of us are working towards ^_^
Posting in the banalist of threads since 2004
2017 Mazda CX-5 GT AWD Premium
Past: 2016 GMC Canyon All Terrain Crew Cab / 2010 Jaguar XFR / 2012 Acura RDX AWD Tech / 2008 Cadillac CTS / 2007 Acura TL-S / 1966 5.0 HO Mustang Coupe
2001 Lexus IS300 / 2004 2.8L big turbo WRX STI / 2004 Subaru WRX / A couple of old trucks
2017 Mazda CX-5 GT AWD Premium
Past: 2016 GMC Canyon All Terrain Crew Cab / 2010 Jaguar XFR / 2012 Acura RDX AWD Tech / 2008 Cadillac CTS / 2007 Acura TL-S / 1966 5.0 HO Mustang Coupe
2001 Lexus IS300 / 2004 2.8L big turbo WRX STI / 2004 Subaru WRX / A couple of old trucks