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Questions tagged [mortgage]

A mortgage is a loan that is secured by real property (land, buildings).

115
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8answers
19k views

Oversimplify it for me: the correct order of investing

I have been reading the top posts here, and the recommendations for what to invest in are often similar. What I'd like to know, in as simply of terms as possible, is what the consensus is on priority ...
17
votes
2answers
2k views

Are multiple hard inquiries for a specific loan type okay?

I'm researching mortgage options for my first home purchase, and I recently had a long call with a loan officer where he encouraged me to get pre-qualified (requiring a hard credit inquiry) as soon as ...
34
votes
7answers
77k views

Why do banks want you to pay off interest before principal?

When you take out a traditional mortgage the first payment you make to a bank pays off mostly interest and then later payments start paying off principal. What is the reason for this? Is it just a ...
13
votes
8answers
111k views

In a house with shared ownership, if one person moves out and the other assumes mortgage, how do we determine who owns what share in the end?

Let us assume a shared ownership house, where everything is 50/50 in terms of deposit, monthly payments, bills, and eventually estate agent costs, and lawyer costs when the house is sold. If the ...
45
votes
7answers
4k views

In general, is it financially better to buy or to rent a house?

I know this differs from country to country, from person to person (depending on how much you already have saved), but I'm curious about the simplest example. Let's say I have little to no money. I ...
87
votes
11answers
61k views

15 year mortgage vs 30 year paid off in 15

I've found similar questions, but they all seem to focus on a preexisting 30 year mortgage and whether or not it makes sense to refinance to a 15. My question is a bit different. I have not yet ...
32
votes
4answers
19k views

After hitting 80% LTV, my mortgage lender refuses to remove PMI. Any recourse?

I recently refinanced my home. At the time based on the appraisal vs. amortization I found I would be stuck with PMI (private mortgage insurance) for about 9 months. I've paid extra on the mortgage ...
4
votes
1answer
607 views

Pay off mortgage or invest in high value saving account

I have a mortgage of 30 yrs amortization and have 290k left on the mortgage. It suddenly hit me that with my bi weekly payment of 620, it would take forever to pay it off. I need some help deciding if ...
31
votes
8answers
5k views

Paying Off Principal of Home vs. Investing In Mutual Fund

I close on my first home October 21. I've locked in a 4.330% APR on a 30-year fixed conventional mortgage and my payment will be ~$800/month. I've put the required 20% down to avoid paying PMI. ...
19
votes
4answers
3k views

Is it better to use a 401k loan to make a down payment or to put less than 20% down?

I'm about to buy a house and am considering two options: Make a 12% down payment and pay for mortgage insurance Take out a 401k loan and make a 20% down payment I'm having a hard time finding ...
114
votes
19answers
28k views

Should I buy my house in cash, or with a mortgage and invest the rest of my money?

I can afford to buy a house (to live in myself) in cash. Most of my investor friends tell me this would be a dumb idea, because I could earn more in interest by buying the house with a mortgage and ...
7
votes
1answer
3k views

PMI cancellation based on original mortgage amount

We bought a house in 2005, and since we did not put 20% down, we have been paying PMI. Since then, the value of our home (and neighborhood) has declined. Our principal balance is currently 77% of ...
9
votes
3answers
2k views

Overpaying on mortgage - How is term reduction calculated?

Just for some example figures: Original Term: 25 Years Loan Amount: £100,000 Interest rate: 2% I'm trying to make an excel table which keeps track of my mortgage payments including overpayments. ...
17
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6answers
2k views

Should I pay off my student loan before buying a house?

Should I pay off my student loan before buying a house?
13
votes
5answers
2k views

Rent or own, given these circumstances

Option A: $3600 (RENT) for a 3/2.5 condo. Option B: $629,000 (BUY) for a 3/1.75 house. This is in the Los Angeles area. Looking to live in this area for at least a year, maybe more. The house ...
18
votes
7answers
22k views

Am I considered in debt if I pay a mortgage?

75% of Americans are in debt. I'd like to know if I'm also considered in debt if I am paying my mortgage on a house. I didn't think I was in debt if I own the house. I guess I pay 'rent' to a bank ...
11
votes
2answers
30k views

Multiple mortgage pre-approvals and effects on credit score

Background Info: My wife and I are looking to purchase our first home/condo. Given our combined gross annual income of ~$100k and lack of any actual debt, we're looking at properties in the $200-250k ...
9
votes
2answers
29k views

Construction loan for new house replacing existing mortgaged house?

Let's say I buy a home with an ordinary thirty-year mortgage, intending to renovate the house slowly and live there a long time (ten years at least). Five years into the mortgage, however, I decide I ...
10
votes
6answers
5k views

Why making additional payment to mortgage counts towards principal? Why does it matter?

When it comes to mortgage advice, some people recommend making an extra payment. The logic is :"These extra payments are automatically applied to your principal, not interest". Why does it matter if ...
5
votes
1answer
6k views

Construction loans - when do payments begin?

For the sake of round numbers, consider this scenario: $300,000 land purchase $700,000 cost to build a home $200,000 down payment Figure building the home will take 1 year. My question is, for ...
3
votes
3answers
2k views

Paying off mortgage or invest in annuity

We are retired, I'm 62 and my husband is 58. We have $150,000 in savings, a 401K at $105,000 and another 401K of $75,000. The home mortgage has a balance of $160,000 with 18 years left on a 20 year ...
52
votes
7answers
3k views

Are there hidden downsides to a shorter mortgage?

It seems that 30-year mortgages are very common (standard?). If I find that the monthly payments for, say, a 10-year mortgage are affordable for me, is there any reason not to go with the shorter term ...
30
votes
2answers
2k views

What percentage of my budget should the mortgage be?

What percentage of my budget should the mortgage be?
27
votes
5answers
19k views

Owning house for 3 years. 15 or 30 year mortgage?

I'm about to move to a new area and will be living there for 3-4 years and then moving to another area (I'm in the military and move every 3-4 years) and I'm thinking that buying a house there is my ...
73
votes
6answers
25k views

Currently sole owner of a property. My girlfriend is looking to move in with me and is offering to pay 'rent'. Am I at risk here?

I currently own a flat (UK) and have a mortgage for said flat. My girlfriend is looking for a place to stay and it would seem mutually beneficial that she stays with me. She has offered to pay 'rent' ...
52
votes
7answers
16k views

How big of a mortgage can I realistically afford?

I'm 25, and I'm in the process of closing on a $260,000 mortgage for a very nice condo in downtown Salt Lake City. My salary is $80,000 right now, which I feel is pretty solid, but I'm starting to get ...
27
votes
8answers
14k views

What's the catch with biweekly mortgage payments?

I just bought a house. Now I'm getting ads in the mail every day or two trying to get me to sign up to pay my mortgage bi-weekly (every two weeks) or weekly instead of monthly. In their words I could ...
6
votes
2answers
23k views

What is the formula for the monthly payment on an adjustable rate mortgage?

Can people tell me how monthly payments are calculated when a mortgage has an initial rate? What is the formula? I have seen online calculators but not formulae. My guess is: We assume that the ...
16
votes
4answers
718 views

What criteria should I use to determine if I should become a home owner?

Currently my spouse and I rent a small apartment. Eventually we'd like to expand the family, and a one bedroom rental won't cut it forever - even if we continue renting we'll be expanding to a ...
81
votes
10answers
13k views

Why is being “upside down” on a mortgage so bad?

For the longest time (especially during/after the housing crash in the US), people would speak in hushed whispers or terrified pleas when they talked about being upside down on their mortgage. While I ...
37
votes
6answers
41k views

Should I pay an extra $100 every month on my mortgage or pay $1200 extra every year at the beginning of the year?

I can pay $1200 extra once a year or $100 every month - which is better? The first one does sound better, but for a 30 year mortgage, is it that significant? Say the mortgage is for $200,000. ...
18
votes
8answers
6k views

60% Downpayment on house?

My fiancee and I are shopping for a house, and very fortunate to have the assets to allow us to make a healthy downpayment. We both like the idea of a lower monthly mortgage payment, specifically the ...
15
votes
6answers
5k views

Put money in savings or pay towards mortgage?

Should we take our excess cash at the end of the month and put it in savings or put it towards our mortgage payment? We've been in our home 3 years and we already have some emergency money saved up. ...
12
votes
2answers
4k views

A good investment vehicle for saving for a mortgage down payment?

I've calculated that I will be able to save approximately enough for a 20-25% down payment on a home (at my back-end-ratio affordability level) in the next 2-3 years. I'm maxing out contributions to ...
6
votes
2answers
1k views

Is it possible to eliminate PMI (Personal/Private Mortgage Insurance) on a mortgage before reaching 20% down on principal?

I am a relatively new home owner, having purchased my first home in October 2009. Overall, I feel I got an excellent deal on the loan, which was 5% no-cost, no points, and 12% down. I had to take on ...
20
votes
4answers
8k views

Can lose everything even when house is almost paid off?

I have a dumb question I've been wondering about. It doesn't apply to me; it's just theoretical. Suppose there's an older couple who bought a house 27 years ago. They have faithfully made the ...
16
votes
3answers
908 views

Should I pay points on my mortgage?

We're looking into refinancing from a 30 year mortgage at 5.5% (currently 23 years left) to a 20 year mortgage at 4.5%. Paying points will reduce the rate somewhat, but since we don't have extra ...
14
votes
8answers
3k views

Extra payments toward mortgage or student loans?

So I have roughly $5000 in student loans at 5% and about $65000 on my mortgage at 3.875% (5/1ARM). Should I put extra payments towards the student loan or the mortgage? 5% is higher, so if it's ...
15
votes
2answers
6k views

What are points on a mortgage?

What are points on a mortgage?
12
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5answers
4k views

For a major expensive home renovation (e.g. addition, finished basement, or new kitchen) should one pay cash or finance with a loan? Would such a loan be “good” debt?

This other question is similar, but was referring to a specific renovation/repair (new flooring) that, while expensive ($1500), isn't very expensive – it's feasible to consider saving up for ...
6
votes
3answers
389 views

What is the best way to determine if you should refinance a mortgage?

What is the best way to determine if you should refinance a mortgage? Is there a general rule of them as far as difference in interest rates? I know closing costs are also a factor. Is there a good ...
4
votes
3answers
691 views

Should we buy a house, or wait?

I am a 22 year old currently renting accommodation with my partner in the UK, and we are wondering if now is a good time to buy a property, and whether or not we can afford it. As background, my ...
4
votes
1answer
203 views

Do I need to remortgage to get rid of PMI?

I called my lender last week. I am close to owning 20% of my home and want to get rid of PMI. They said I can only do it by remortgaging my house. Is that true? With the mortgage rates increasing, I ...
2
votes
3answers
811 views

What effect would sovereign default of a European country have on personal debt or a mortgage?

What effect would sovereign default of a European country have on personal debt, especially a mortgage?
30
votes
9answers
11k views

Can I buy a new house before selling my current house?

I am looking to sell and buy a house. But with the current market being as crazy as it is (houses are selling fast for sometimes 150,000 over asking), I'm afraid if we sell first, we could be stuck ...
8
votes
4answers
9k views

Can a US bank prevent you from making early payments to the principal on a home mortgage?

My friend was told by her bank she could not make early payments and apply them to the principal on her home mortgage. She wants to pay half her mortgage every two weeks and it seemed like a ...
7
votes
3answers
379 views

HELOC with no first mortgage (for liquidity--no plans to spend it)

For a home-owner with no debts, a good salary, credit score, etc.: What terms would be optimal for future liquidity when obtaining a home equity line of credit (HELOC)? The point is to obtain ...
5
votes
1answer
971 views

My girlfriend has never owned a house, I have, can she get a help to buy isa?

this is a follow on from my previous question: What is the definition of a “first time buyer” with relation to the UK “help to buy isa”? So the Help to buy ISA has arrived. Having had a read though ...
5
votes
3answers
873 views

Paying off student loan or using that money for a downpayment on a house

I am 22 years old, I live in Atlanta, Georgia and I am a recent graduate. I approximately owe 22,000 dollars in student debt (all federal student loans at a fixed rate). My job pays me around 50,000 ...
5
votes
2answers
718 views

Do jumbo loan limits apply to the amount borrowed or to the property price? Can I avoid a jumbo with a higher down payment?

I live in an area of the United States where it would be very difficult to get a home for less than the $417,000 conforming loan limit. Unfortunately, jumbo loans seem to have a hard 20% downpayment ...