40 year mortgage? what the heck? (loans, credit, refinance, equity)

[jmking]

There could be an advantage to the 40 year mortgage for those who are about to go belly up with mortgages with balloon payments. When the housing bubble burst the first thing I thought of was the 40 year mortgage to help bail out those who truly can not pay their current payments. Why not? Overtime they could refinance.

[revelated]

Originally Posted by Va-Cat

May I make a suggestion to you? Please read "Terms of Service". I also interpreted your "Blah, blah, blah" as disrespectful. No inflection or tone can be interpreted from written words so its very easy to be misunderstood. Please heed the advice to be respectful, even if you don't agree with whats being said. This board is for sharing of useful information - not flaming others points of view

No flaming occurred. If you can point me in the direction of a post I made that flamed another individual, I'd be man enough to apologize to them. I don't think you'll find one, because there isn't one.

I also see nothing in the TOS about creative editing of quoted replies to emphasize one part of a previous person's post. If you find something about that, do point it out, and I'll apologize.

[nevergoingback]

Ha Ha!! renters 1 "owners' 0 ROTFLMA!!!!!!!!! ha ha ha. I dont know about you but I LOVE having someone else pay my mortgage off, all while "giving" me an EXTRA 200 bucks a month!!! ha ha ha!!!!

keep renting and paying someone else's mortgage off ha ha LOL!! WOW!!!

[renriq02]

2 members found that your post was disrespectful, and you still wont admit that you were wrong. How many members do you need to tell you that you were flaming before you actually recognize that you're wrong?

Read what the report button states:
Note: This is ONLY to be used to report spam, advertising messages, and problematic (harassment, fighting, or rude) posts.

[Va-Cat]

Originally Posted by jmking

There could be an advantage to the 40 year mortgage for those who are about to go belly up with mortgages with balloon payments. When the housing bubble burst the first thing I thought of was the 40 year mortgage to help bail out those who truly can not pay their current payments. Why not? Overtime they could refinance.

For a quick fix - it would be an option but from an investment point of view - you would be somewhere into your 30th year of the amortization schedule on the loan before you would be adding to your equity. Not a very sound or practical investment. I'd lump it into the catagory of timeshares, leased vehicles and leased equipment. Money spent and no equity gained. Great for cashflow but not a good use of your money.

[jmking]

Originally Posted by Va-Cat

For a quick fix - it would be an option but from an investment point of view - you would be somewhere into your 30th year of the amortization schedule on the loan before you would be adding to your equity. Not a very sound or practical investment. I'd lump it into the catagory of timeshares, leased vehicles and leased equipment. Money spent and no equity gained. Great for cashflow but not a good use of your money.

I agree. I'm no expert, however, it would help some keep their homes, also my thinking would be that they can refinance the loan to a lower year and fixed amount overtime. I suppose that "overtime" maybe an issue involving putting money on the table at closing, but the alternative may not be so good either. It may save taxpayers money too.

[renee_cal]

Well this same person stated in the end she would have paid almost triple for the house and its not in the best neighborhood. Yes those who are in trouble now can refinance using this type of motrgage but refinancing again to a 30y mortgage would leave them at a loss no? how can they refinance to a lower year when they wont have any if much equity?

sounds nuts to me! just buy what you can afford!

[Va-Cat]

Originally Posted by nevergoingback

Ha Ha!! renters 1 "owners' 0 ROTFLMA!!!!!!!!! ha ha ha. I dont know about you but I LOVE having someone else pay my mortgage off, all while "giving" me an EXTRA 200 bucks a month!!! ha ha ha!!!!

keep renting and paying someone else's mortgage off ha ha LOL!! WOW!!!

Interesting statement. You don't think that you pay someone elses mortgage? Bought groceries lately or paid that high speed internet bill? Everytime we buy something we are paying someone elses mortgage, or rent payment, or car payment, or maybe a trip to the tropics. Home ownership is only better than renting if thats your priority. Its a personal choice. I rented for years because it suited my lifestyle. Didn't want to be tied down and wanted the freedom to move where ever I wanted without having to wait to sell property to finance it. Home ownership certainly has its advantages but so does renting. I was able to travel the world before I was 30 with the money I saved. Even lived outside the US for almost 5 of those years. I could have used that money for a down payment but thats not what I wanted back then. Everyone has their own priorities. Not everyone's priorities are the same as yours.

[nevergoingback]

Originally Posted by Va-Cat

I was able to travel the world before I was 30 with the money I saved.

Nice post. I was able to make over 100k before I was thirty investing in real estate, good for me.
If rent is more than the mortgage, who's saving money?
I will agree to disagree

[Va-Cat]

Originally Posted by nevergoingback

Nice post. I was able to make over 100k before I was thirty investing in real estate, good for me.
If rent is more than the mortgage, who's saving money?
I will agree to disagree

It wasn't about saving money - just what I did personally with the money I had. Lots of great momories and a few wild stories - may even share them with my kids or grand kids one of these days. Home ownership just wasn't important to me back then - seeing the world was. That is what made it worth it.