"P.Fritz" wrote in message
...

"NOYB" wrote in message
ink.net...

"basskisser" wrote in message
ups.com...

You have no clue about interest only loans, do you? A fixed rate
interest-only loan is ideal in a market with rapidly appreciating
properties.

Oh, so then, you plan on keeping your interest only loan for ever? The
lender will GLADLY do that! Do you REALLY think that it's sound
financial advice to tell someone to buy something, paying only the
interest, and not paying down ONE BIT of the principal????

Yes. *If* the house is in a rapidly appreciating area *and* they intend
to sell it (or reverse mortgage it) upon retirement.

If they want it paid for *in full* by retirement, then the answer is
*no*.

As long as you have the cash flow, and an interest rate lower than the
average return in the stock market......it is ALWAYS better to have the
maximum mortgage.






What you're confusing it with is "minimum payment" loans that
have ridiculously low initial rates of 1.5% or less. Those are
dangerous
loans, because as rates rise, you can get into a negative
amortization
situation.

Where is the risk with 5 year fixed-rate interest-only loans? And
how are
they any different from a conventional ARM? Answer: they're not.
You pay
so little principle in the first 5 years of a conventional loan, that

there's virtually no difference from an interest-only loan.
If you pay the minimum, yes.

If you can afford to pay more than the minimum, then why not just go with
a shorter term loan? You'll get a lower interest rate, and you'll pay
far, far less interest over the life of the loan.

An interest-only loan just lowers your "minimum payment" each month. I
could always pay principle if I wanted to.


But then all you are doing is buying a 4% note back from the
bank.......why do that when you can get 7-10 in the market/


I was just speaking about what I'd do if I were dumb. I, of course, would
never do that. ;-)

"DSK" wrote in message
...
NOYB wrote:
Why is it dumb? I explained in detail why it works well for me. Why pay
interest on an asset that's appreciating at 10-20% per year?

Because it's a mug's game. You're handing over a lot of money to the bank,
and paying upkeep & insurance on a big fancy house you can't really
afford, while hoping that the boom will continue long enough for you to
come out ahead.

In the stock market, this is called the "greater fool" strategy. Guess
why.


So what. In 2009, my rate can begin adjusting 2 points per year, upto a
max of 5 points.

Sorry, read the fine print. If the prime rate hits 12% again, do you think
your banker is going to be all palsy-walsy about keeping your fancy
expensive roof over your head, out of his pocket? Homey don't play dat...
your mortgage is probably already sold off to a secondary holder who has
no contractual obligation to you.

Wells Fargo is everybody else's secondary holder. They haven't sold off the
note, and never will. And even if they did, any future party is bound by
the contractural terms of the loan that they buy.





Insurance is just legalized gambling. Think for a second... why do you
have to gamble so heavily on your own failure? If you weren't taking big
risks, you wouldn't need so much insurance.


And I would reap the rewards that go along with risk.

Although you've certainly shown yourself to be mean-spirited and petty, I
don't wish you ill. My advice is that tap-dancing on the edge of a cliff
is not a profitable undertaking, but you've convinced yourself otherwise.
Good luck.


It's already become profitable. When I refinance in April to consolidate
all of my non-business debt (taking advantage of the 1-year 25% appreciation
which has already taken place), I'll have freed up about $1000/month in
additional cash. (And, no, I don't have any credit card debt).

My house has already gone up 25%. Homes in my neighborhood would now have
to *lose* 20% of their present value just for me to be even.

NOYB wrote:
Wells Fargo is everybody else's secondary holder. They haven't sold off the
note, and never will.

If that's true, then it's relatively safer. But I'd want some damn
reliable sources for that before dangling my families future over that
cliff. Very very few mortgage holders have street offices.

BTW do you think the Fanny Mae shake-up is going to affect the housing
market?


.. And even if they did, any future party is bound by
the contractural terms of the loan that they buy.


Nope, sorry, thanks to Bush Sr, they don't. Happens every day in America!

The first Bush Administration also changed the rules for investment
disclosure. One of the reasons why I distrust the whole family is that
they have long history of making it easy for crooks, frauds, and con men.



It's already become profitable. When I refinance in April to consolidate
all of my non-business debt (taking advantage of the 1-year 25% appreciation
which has already taken place), I'll have freed up about $1000/month in
additional cash. (And, no, I don't have any credit card debt).

Well, that sounds good. But it's a silly rigmarole to get a place to
play boats, and it's even sillier as a way to attempt to build net worth.


My house has already gone up 25%. Homes in my neighborhood would now have
to *lose* 20% of their present value just for me to be even.


And you're totally convinced that this can't happen? Still praying that
the "greater fool" strategy will pay off?

Consider that prices for *any* good or service never stray too far, too
long, from the background rate of inflation. It's like the economic Law
of Gravity. Betting against it is just plain dumb. Furthermore, betting
on a long-term boom in very high-priced luxury goods is even dumber.
Aren't you one of the people who crow about Wal-Mart's economic success?
Consistancy ain't your strong point, is it?

Why not sell now, short term, and take the cash? That's be the smartest
thing, especially if you could convince the buyer to let you keep your
boat there for free as part of the bargain.

Again, I wish you luck.

DSK

"NOYB" wrote in message
nk.net...

"DSK" wrote in message
...
NOYB wrote:
Why is it dumb? I explained in detail why it works well for me. Why
pay interest on an asset that's appreciating at 10-20% per year?

Because it's a mug's game. You're handing over a lot of money to the
bank, and paying upkeep & insurance on a big fancy house you can't really
afford, while hoping that the boom will continue long enough for you to
come out ahead.

In the stock market, this is called the "greater fool" strategy. Guess
why.


So what. In 2009, my rate can begin adjusting 2 points per year, upto a
max of 5 points.

Sorry, read the fine print. If the prime rate hits 12% again, do you
think your banker is going to be all palsy-walsy about keeping your fancy
expensive roof over your head, out of his pocket? Homey don't play dat...
your mortgage is probably already sold off to a secondary holder who has
no contractual obligation to you.

Wells Fargo is everybody else's secondary holder. They haven't sold off
the note, and never will. And even if they did, any future party is bound
by the contractural terms of the loan that they buy.

Where the hell do people get ideas like that.......a secondary holder has
all the same obligations of the note....they cannot change that. The very
reason you got such a good rate is that the note is only for 5 years,
therefore there is little risk to the lender.....which is represented in the
reduced rate........sheesh.....what is so difficult to understand about
that?







Insurance is just legalized gambling. Think for a second... why do you
have to gamble so heavily on your own failure? If you weren't taking big
risks, you wouldn't need so much insurance.


And I would reap the rewards that go along with risk.

Although you've certainly shown yourself to be mean-spirited and petty, I
don't wish you ill. My advice is that tap-dancing on the edge of a cliff
is not a profitable undertaking, but you've convinced yourself otherwise.
Good luck.


It's already become profitable. When I refinance in April to consolidate
all of my non-business debt (taking advantage of the 1-year 25%
appreciation which has already taken place), I'll have freed up about
$1000/month in additional cash. (And, no, I don't have any credit card
debt).

My house has already gone up 25%. Homes in my neighborhood would now have
to *lose* 20% of their present value just for me to be even.

And they will most likely keep going up......just the inflation rate alone
pushes the cost of construction up, then throw in the sustained popilation
growth in Fla, and the dwindling supply of waterfront property.

"basskisser" wrote in message
oups.com...

I have a friend, who actually worked for the local Wells Fargo office
here, and he left after six months.

Who? Walt Irvin?

joe wrote:
"basskisser" wrote in message
oups.com...

I have a friend, who actually worked for the local Wells Fargo
office
here, and he left after six months.

Who? Walt Irvin?

Do you think you'd know him. Hey, JoeTechnician, since I've got you
here, how come, when you asked for proof of my identity, and I told you
that I'd show you my driver's license to your face when I come to
Tampa, you disappeared......why IS that? You sure seem to have a lot of
bravado hiding behind privacy.net, but, I guess you just aren't brave
in person.....pathetic.

P.Fritz wrote:
Where the hell do people get ideas like that.......a secondary holder has
all the same obligations of the note....they cannot change that.

Where hell do people get ideas like that?

A mortgage buyer has no obligation whatever to the mortagee. His
contract is with the mortgage initiator. How do you think Fannie,
Ginnie, and Freddie stay in business?

In most states, they *do* have the legal obligation to tell you before
they change the terms of your mortgage. But they don't have any
obligation to stick to the original terms. Happens every day.


... The very
reason you got such a good rate is that the note is only for 5 years,
therefore there is little risk to the lender.....which is represented in the
reduced rate........sheesh.....what is so difficult to understand about
that?


Not difficult to understand at all. I was just pointing out that it's a
gamble, and IMHO a dumb one considering the pressures on interest rates.


And they will most likely keep going up......just the inflation rate alone
pushes the cost of construction up, then throw in the sustained popilation
growth in Fla, and the dwindling supply of waterfront property.


So you're counting on high inflation to make your loan profitable, and
low inflation to keep your loan affordable? That makes great sense!

As for increased population, what percent of that population can afford
a million dollar house? What percentage has a burning desire to live on
a man-made canal which is subject to flooding, silting, is a mosquito
breeder, and is likely to become ever more polluted under increasingly
strong Bush/Cheney policies?

Think. It's painful and the results don't aren't always agreeable, but
if you're going to gamble with your families future, at least you should
know what you're gambling on.

DSK

"DSK" wrote in message
...
P.Fritz wrote:
Where the hell do people get ideas like that.......a secondary holder has
all the same obligations of the note....they cannot change that.

Where hell do people get ideas like that?

A mortgage buyer has no obligation whatever to the mortagee. His contract
is with the mortgage initiator. How do you think Fannie, Ginnie, and
Freddie stay in business?

In most states, they *do* have the legal obligation to tell you before
they change the terms of your mortgage. But they don't have any obligation
to stick to the original terms. Happens every day.

You're absolutely wrong. Purchasing a contract doesn't absolve the buyer of
the contract from the responsibilties that are spelled out in the contract.
When an assignment of mortgage takes place, the secondary lender is on the
hook for all of the terms of the original mortgage. Period.

"NOYB" wrote in message
nk.net...

"DSK" wrote in message
...
P.Fritz wrote:
Where the hell do people get ideas like that.......a secondary holder
has all the same obligations of the note....they cannot change that.

Where hell do people get ideas like that?

A mortgage buyer has no obligation whatever to the mortagee. His contract
is with the mortgage initiator. How do you think Fannie, Ginnie, and
Freddie stay in business?

In most states, they *do* have the legal obligation to tell you before
they change the terms of your mortgage. But they don't have any
obligation to stick to the original terms. Happens every day.

You're absolutely wrong. Purchasing a contract doesn't absolve the buyer
of the contract from the responsibilties that are spelled out in the
contract. When an assignment of mortgage takes place, the secondary lender
is on the hook for all of the terms of the original mortgage. Period.

No ****, if that were true, a secondary buyer could change the interest
rate, payment due date, prepayemnt clause etc etc.

The fact is the mortagee has a contract, those terms cannot be altered by a
third party.

Now credit cards are a whole different story.

"P.Fritz" wrote in message
...

"NOYB" wrote in message
nk.net...

"DSK" wrote in message
...
P.Fritz wrote:
Where the hell do people get ideas like that.......a secondary holder
has all the same obligations of the note....they cannot change that.

Where hell do people get ideas like that?

A mortgage buyer has no obligation whatever to the mortagee. His
contract is with the mortgage initiator. How do you think Fannie,
Ginnie, and Freddie stay in business?

In most states, they *do* have the legal obligation to tell you before
they change the terms of your mortgage. But they don't have any
obligation to stick to the original terms. Happens every day.

You're absolutely wrong. Purchasing a contract doesn't absolve the buyer
of the contract from the responsibilties that are spelled out in the
contract. When an assignment of mortgage takes place, the secondary
lender is on the hook for all of the terms of the original mortgage.
Period.

No ****, if that were true, a secondary buyer could change the interest
rate, payment due date, prepayemnt clause etc etc.

The fact is the mortagee has a contract, those terms cannot be altered by
a third party.


The rules apply whenever there's a contract. A mortgage is a contract. My
lease is a contract. When I leased my office space, I knew that there was
the likely scenario of the landlord selling it to another party. I
contacted an attorney to ensure that the new landlord couldn't buy the
building, terminate my lease, and toss me out. They can't. They must honor
the contract/lease, or provide compensation to me if they need to alter the
terms of the lease in any way.

I know of one dentist who had 4 years remaining on a lease in a building
that was sold and scheduled to be torn down. He got nearly $200k from the
building's new owner to move out of his lease space...AND sufficient time to
find a new location, build it out, and move into it.