I'm trying to get some different opinions on what I should do. I'm selling my home and buying another. The difference is $25,000. I have $50,000 in my bank account, no debt, $10,000 in a Roth IRA and around $5,000 in my personal trading account. (I'm mid twenties, and I started investing three years ago.)
I am thinking about taking a secured loan from my credit union for $25,000 with a 2.74% interest rate and putting my $19,000 car on it. I don't want to take out a mortgage for several reasons.
My reasoning for this is my monthly payment will be close to $1,100 (which I can afford) and the interest from the loan is roughly $720 over the life of the loan. If I invest $10,000 into my stock account and invest in a safe mutual fund (3-5% per year), I will be able to recoup the $720 loss (and maybe make some) and not use my own money.
Is this the smart thing to do? Worst case scenario is I pay off the loan early (no penalty) and my bank account takes the hit. Thoughts? Opinions?