48
There is no downside for you but there is for the company.
If the company has a bad year, it can stop your bonus but it can't reduce your salary (or at least that is much harder to do).
When is the last time you got a raise? Since you are getting good bonuses you seem like a valuable employee. Why not just ask for a raise without mentioning your bonus?
34
I would not purchase a larger house just for the hope in appreciation. If you intended to use part of it to earn rental income, then perhaps the business case may be made. However, you are in the PMI realm with the larger house so that most certainly points you to the smaller house as the best business decision.
Even if PMI were not a factor, heating, ...
16
I'd say buy the least expensive house that meets your needs. The home you live in is generally a poor investment. While (good) real-estate tends to at least keep pace with inflation there are many costs associated with it that people fail to consider when looking at the price increase alone. Consider:
Upkeep: you will likely need a new roof at some point,...
15
I can not give you a silver bullet to this question (there is not perfect way) but some points to think about:
how much do interest rates differ? 30 years fixed is more expensive than 15 years fixed. Larger down payments give better interest rates.
How much debt is left after 15 years? If interest rates rise considerably, when will it financially break you?
...
8
Stop worrying about the sunburn (reducing 3.75% to 2.25%) when your hair in on fire ($30K debt at 10%).
Facts: you've got $10K in cash, and can afford a $1927 monthly mortgage.
@RonJohn still thinking about this...added another option, what are your thoughts?
My thoughts:
Immediately throw $8K at the CC. That reduces it to $22K.
Immediately apply an ...
7
When I was working, my wife and I were both in sales, and our total income averaged about 140% of our "salary". For purposes of a mortgage, banks looked at a 3 year average. Imagine if our entire income were the same, but it was all considered 'commission' or 'bonus'. That would be tough if the bank insisted on seeing a fixed salary only.
answered Feb 25 at 13:59
5
You mentioned:
I'd be buying bigger mostly as a sort of investment.
If that's the main reason to go bigger, then I'd probably avoid it. That being said, for many people, the pandemic has shifted priorities when it comes to home buying. This is a finance site and of course we tend to prioritize wise financial decisions regarding whether or not to think of ...
5
A) don't buy more than you need, do not buy a principal residence as an investment.
B) Generally, do not plan to pay off the house. You can borrow money more cheaply than you can earn it through investing.
Bury as little money into the house that you can, and invest the rest. Because of the time-value of money a $500/mo payment today will be equivalent to a $...
4
The downside is primarily that the company won't be willing to give you as much money in salary raise as it will in bonus.
Salary raises are cumulative, first off; so if you get a Cost of Living raise every year of 2-3%, if your starting salary is $100k, your 2% raise is $2k, but if your starting salary is $120k, your 2% raise is $2.4k, while if you have a ...
4
Regardless of whether it's cash or financed, the seller (and lien holders) get paid the entire amount at closing in standard arrangements.
The reason people prefer cash offers is that purchase offers using financing will have multiple contingencies. The primary reasons the deal can fall through or need to be re-negotiated are if the property's appraisal ...
3
When the buyer pays cash (i.e. without taking a loan), would it usually mean that the buyer will have to pay the whole amount in a single payment?
Single payment
Or is it acceptable to first pay a certain initial payment, and then the rest of the amount in monthly installments? Is the latter the same seller financing?
Yes, that is basically seller-...
3
Recently I applied for a Freddie / Fannie loan. They said I was self
employed.
Somehow I can't imagine this is true. I feel like there must be an
exception for this circumstance.
By self employed they mean that you are not a W-2 employee. You setup a C2C relationship, and formed a company. You decide how much of the corporate income is your salary. They ...
2
There one key thing incorrect in your assumptions. FHA mortgage insurance remains for the life of the loan, it will never go away. It is one of the things that make VA and FHA loans a bad deal compared to conventional.
Almost certainly the best way to invest 10K in a home, in your situation, is to refi in a conventional loan with a LTV of 80%. The bonus ...
2
Make a total cost of ownership calculation. Larger houses mean not just larger mortgage, but also higher heating costs, taxes, electricity and cleaning time or cost (depending if you clean yourself or have a cleaning service/person). The difference can be substantial and also adds up over the months and years.
It also means higher repair costs and a higher ...
1
In general
When a buyer pays in cash they have to pay the full amount in a single payment. Sellers Finance is when seller (owner) arranges the finance for the buyer instead of the buyer arranging finance from a traditional lender such as a bank.
When using a bank , the bank pays the seller the entire amount up front.For instance the seller is selling a ...
1
Remember that the people giving you the money for your mortgage are probably richer and smarter than you, yet they think the interest they'll collect on your mortgage is the best investment they can make. You can go ahead and bet that your investment will pay better than theirs, but I wouldn't.
So the smart strategy is to minimize the interest you pay. ...
1
Glancing at the CARES Act Mortgage Forbearance page, it looks like you are just deferring payments, so I don't see that a "15-month hole in the payment schedule" translates to "a no-interest loan for 20 years". Below is my expectation of how it would play out, but I have added a final note in case the bank actually waives interest ...
1
With the same total value, there is one downside for you to increasing your salary in place of part of a bonus: you get the extra salary spread out over the next year, instead of getting all of it immediately.
The upsides are overwhelmingly more important unless you are in desperate need of immediate cash, however. The most important upside by far is that a ...
1
Oversimplify it for me: the correct order of investing really goes a long way to answering your question. But of course, you offer details that are important to address.
The 15 has its place. The risk averse investor that leans toward "I'd sleep better knowing I have no debt at all" for one.
But. As the 'correct order' shows, I'd be paying off that ...
answered Feb 8 at 20:23
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