On Sat, 10 Jan 2009 12:04:41 -0800, "Calif Bill"
wrote:


As to NOYB the guy in Florida, he may lose the house if he can not
refinance, but he bought the house early enough before a lot if the price
inflation and he got to write off 35% of his payment. Probably cheaper than
renting a house. The taxpayers subsidized his renting the house. May owe
taxes on the unpaid part of the loan if foreclosed. Do not know the rules
on that. Credit cards, they write down the balance owed, and you get a 1099
for the amount written down. Ordinary income.

As I recall NOYB is a dentist with a good income.
He should be doing just fine.
As to refi's, I'm not sure how people got into trouble with the
various home loans. Must have not read the terms or lost their jobs.
I did a 3 yr ARM refi about 6 years ago at 3.75%. I had planned on
paying it off before it adjusted from 3.75%, but didn't quite make it
before I retired, and still have about 30 g's on it.
Thing is it never went past 6.75% and is now 5.75%.
So far I haven't wanted to take the tax hits in cashing in IRA's to
pay it off.
It's not easy figuring out how to best do that, as we have little
taxable income. And I'm lazy about thinking since I retired.
But I think I have to figure out how to knock down the principal
pretty soon, as I'll be paying that interest forever - and maybe even
at a higher interest rate.
Once they adjusted this one it went on a 30 year amort schedule and
though the payment is low, it's nearly all goes to interest.
I hate paying interest, and on the surface it looks like I would pay
more in taxes by cashing in CD's.
But if you look at an amort schedule and see TOTAL payments over some
years, it might make sense to just take the one time tax hit. Depends
too on when and if I move south.
Just have to make sure I can still afford the "boat(s) of my dreams."
I'm thinking of getting a little help on handling my money.
Anybody know about a guy named Bernie Madoff?
He's been highly recommended by those "in the know."

--Vic