U.S. CitiesCity-Data Forum Index
Go Back   City-Data Forum > General Forums > Economics > Personal Finance
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 01-04-2015, 02:58 PM
 
Location: Atlanta
3,190 posts, read 3,180,529 times
Reputation: 2015

Advertisements

What I mean is, let's say:

You're 58 years old and get a 30 year mortgage as opposed to say a 10 year one although you don't expect to live long enough to pay it off. But your goal is to have more money freed up to travel to see grandkids, explore hobbies during retirement while you're still healthy enough to get out the house and drive on your own, just enjoy life....

In your opinion, is it morally wrong to do this for any reason?

If you think there's nothing wrong with doing the above, then I have a second question for you:

Which choice below is a better move in the hypothetical situation of a person grossing $100k a year (single, no kids, 40 years old, 100K total in retirement funds, with their most important current financial goal being to play the retirement 'catch up' game):

(1) Buying a $300,000 house for a monthly mortgage of $1,500 (term: 30 years)

(2) Buying a $150,000 house with a monthly mortgage of $1,500 (term: 10 years)
Reply With Quote Quick reply to this message

 
Old 01-04-2015, 03:03 PM
 
Location: southwestern PA
20,419 posts, read 37,470,794 times
Reputation: 39034
Quote:
Originally Posted by southkakkatlantan View Post
What I mean is, let's say, either:

You're 58 years old and get a 30 year mortgage as opposed to say a 10 year one although you don't expect to live long enough to pay it off. But your goal is to have more money freed up to travel to see grandkids, explore hobbies during retirement while you're still healthy enough to get out the house and drive on your own, just enjoy life....
If my goal at age 58 is to travel and get out of the house (as you say above), I would not buy a house.
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:05 PM
 
Location: Atlanta
3,190 posts, read 3,180,529 times
Reputation: 2015
Quote:
Originally Posted by Pitt Chick View Post
If my goal at age 58 is to travel and get out of the house (as you say above), I would not buy a house.
Why not?
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:07 PM
 
Location: southwestern PA
20,419 posts, read 37,470,794 times
Reputation: 39034
Do you own a house?
I do.

Upkeep, taxes, maintenance, etc... all good when you are around to take care of things.
Not good when the plan is to travel and "get out of the house"!
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:16 PM
 
1,511 posts, read 1,419,517 times
Reputation: 10980
A mortgage is a loan secured by an asset--the house. If the mortgagee dies before the loan is paid off, the bank recovers the outstanding balance from the estate, which includes the value of the house. The heirs might be able to negotiate with the bank to pay off the mortgage, take over the payments, or refinance the mortgage and keep the house if that is what they want to do, but the house will most likely be sold with the proceeds going to pay off the remainder of the mortgage and whatever is left going to the heirs. Some people have mortgage insurance, which will pay off the mortgage in the event the mortgagee dies before it is paid off. There is nothing immoral about taking out a mortgage with a term longer than one's life expectancy because the mortgage is secured by the asset on which it is loaned. The loan doesn't just disappear with the death of the mortgagee. The asset still exists and will be sold or refinanced to satisfy the mortgage.

Regarding your two scenarios, I don't think it really matters. Just buy the house you want.
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:19 PM
 
18,716 posts, read 13,492,794 times
Reputation: 14107
I see nothing wrong with taking out a 30 year loan even if you don't plan on living that long. If it gives you better cash flow to spend elsewhere no problem with that
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:27 PM
 
Location: N/A
849 posts, read 1,575,355 times
Reputation: 929
Here's an idea...Why not put the $150k house on the 30 yr to free up more cash? You could always pay more as you go...
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:29 PM
Status: "On The Lookout" (set 21 days ago)
 
Location: The Triad (NC)
28,384 posts, read 61,750,545 times
Reputation: 31926
Quote:
Originally Posted by southkakkatlantan View Post
You're 58 years old and get a 30 year mortgage
although you don't expect to live long enough to pay it off.
In your opinion, is it morally wrong to do this for any reason?
The issue is your ability to keep up with the payments until you are forced out.
btw, that phrase "payments" incl ALL ownership costs down to the person who rakes leaves

Few people who don't have the CASH to buy that house really can.
And because of THAT they shouldn't paint themselves into that corner.
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:30 PM
 
70,808 posts, read 71,189,712 times
Reputation: 48410
if you were older get a reverse mortgage to purchase. it is not the same thing as regular reverse mortgage.

you make a sizeable down payment and never make another mortgage payment again.
Reply With Quote Quick reply to this message
 
Old 01-04-2015, 03:34 PM
 
Location: Atlanta
3,190 posts, read 3,180,529 times
Reputation: 2015
Quote:
Originally Posted by Pitt Chick View Post
Do you own a house?
I do.

Upkeep, taxes, maintenance, etc... all good when you are around to take care of things.
Not good when the plan is to travel and "get out of the house"!
Nope, I do not and never have. And constantly struggle with whether I should ever 'aim to do so'.

I don't think it's the right decision to do right now. But perhaps owning from 40-50 would be good (the largest home I can afford with the lowest mortgage possible and a roommate to cover the mortgage). Then sell and buy a small condo on the beach somewhere.

At least, that's what I think today...at 36. That could change at 45...or 39...or tomorrow lol
Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics > Personal Finance
Follow City-Data.com founder on our Forum or

All times are GMT -6. The time now is 07:26 AM.

2005-2019, Advameg, Inc. | Please obey Forum Rules | Terms of Use and Privacy Policy

City-Data.com - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35 - Top