On Wed, 23 Mar 2005 13:31:05 GMT, "NOYB" wrote:


"basskisser" wrote in message
roups.com...

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year fixed,
because
it gives me the option to pay principal on the loan (but only if *I
*decide
to do so). Right now, it makes more sense for me to put $25-30k per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At that
time, I
can get a 20 year conventional fixed mortgage, and pay the home off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed your
brain so much.

He's probably embarrassed because he hadn't thought of it.
--
John H

"All decisions are the result of binary thinking."

"Bert Robbins" wrote in message
...


That attitude will keep you angry and bitter at the entire world.


Huh??...................who's angry & bitter?

John H wrote:
On 23 Mar 2005 05:01:54 -0800, "basskisser"
wrote:


NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......

basskisser, is that the best you can do when you see a good idea put
in place?
--
John H

No, but you know how NOYB is, no sense in trying to make him think
anything other than what he does, says, where he lives, his occupation,
his thoughts, and on and on, are anything less than superior to anyone
else in the universe. Just ask him! Now, as far as a "good idea", he's
admitted himself that he is financially stretched tight.

John H wrote:
On Wed, 23 Mar 2005 13:31:05 GMT, "NOYB" wrote:


"basskisser" wrote in message
roups.com...

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

He's probably embarrassed because he hadn't thought of it.
--
John H

Hehe! The mortgage companies PUSH interest only to people. Why? Care to
take a guess?

P.Fritz wrote:
"NOYB" wrote in message
ink.net...

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

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

And he wonders why he is the "King"

I see that you still can't interject anything mentally competent into a
thread, so you resort to childish name calling.

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

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

The mortgage companies PUSH interest only loans to consumers. Care to
venture WHY????

On 23 Mar 2005 09:44:18 -0800, "basskisser" wrote:


John H wrote:
On 23 Mar 2005 05:01:54 -0800, "basskisser"
wrote:


NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......

basskisser, is that the best you can do when you see a good idea put
in place?
--
John H

No, but you know how NOYB is, no sense in trying to make him think
anything other than what he does, says, where he lives, his occupation,
his thoughts, and on and on, are anything less than superior to anyone
else in the universe. Just ask him! Now, as far as a "good idea", he's
admitted himself that he is financially stretched tight.

My daughter has commented to me about having a negative balance, on occasion, in
my checkbook. To her, who has bounced a check to me, this was really something
to 'catch her dad' with.

There are times when it is beneficial to one's longer term interests to be
somewhat 'stretched tight'. That is not, necessarily, a sign of bad financial
management. I financed my house for 15 years instead of 30. The additional
payment amount stretched me a little more than I had been, but I think that the
long term benefits will be worth the stretch.

I don't know NYOB's situation, other than what I've read. I *do* know that he
has given thought to his situation. That, in itself, is more than a lot of folks
do.

His plan makes sense.

There may be those in the universe who have a better occupation, better place to
live, and are better able to express their point of view. From my perspective,
you haven't shown that you are one of them. Of course, that's just my opinion.
--
John H

"All decisions are the result of binary thinking."

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

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

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

The mortgage companies PUSH interest only loans to consumers. Care to
venture WHY????


Because they have a non-decreasing revenue stream coming in while the
principal is outstanding. So what. It's good for the bank...but even
better for me.

Are you smart enough to do the math on exactly how much *principle* you're
actually paying in the first 5 years of an $800000 mortgage at 4.25%?

I'll get you started:

Payment (principle+interest)= $3935.52
Payment (interest only)= $2833.33

(Answer= $66,131.20)

So at the end of 5 years, I'd owe $800,000...and the guy who paid principle
owes $733, 868.80.

Keep in mind that I'm putting that $66,131.20 into my wife's and my Simple
IRA's instead of towards the principle of the house. Because it's a
qualified plan, I saved $20k in Federal taxes over the schmuck who used the
money to pay down the principle on his home.

At the end of 5 years, he paid an extra $20k in taxes to the Feds, and owes
$733, 868.80 on the home.

At the end of 5 years, I put $66k into my simple IRA and paid $20k less to
the government. Even if the house doesn't appreciate, and I get *ZERO*
return on my investment in the Simple IRA, my net worth is ahead of his by
$20k. If I get even a nominal 5% return on my Simple IRA per year, I'm even
further ahead of the other guy.

Paying principle on a loan is an opportunity cost.

On 23 Mar 2005 09:45:55 -0800, "basskisser" wrote:


John H wrote:
On Wed, 23 Mar 2005 13:31:05 GMT, "NOYB" wrote:


"basskisser" wrote in message
roups.com...

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

He's probably embarrassed because he hadn't thought of it.
--
John H

Hehe! The mortgage companies PUSH interest only to people. Why? Care to
take a guess?

Upon what do you base that comment?
--
John H

"All decisions are the result of binary thinking."

"NOYB" wrote in message
.net...

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

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

NOYB wrote:
wrote in message
oups.com...
But, I thought that you had to get an interest only loan?????


The bank was offering me either loan...conventional, or
interest-only.

I chose the interest only loan over the conventional 30-year
fixed,
because
it gives me the option to pay principal on the loan (but only if
*I
*decide
to do so). Right now, it makes more sense for me to put $25-30k
per
year
away in a qualified pension plan than to pay principal on a home
mortgage.
In 4 1/2 years, I'll only be 38...and I'll have an extra $6000/mo
(before
taxes) to put towards principal and/or retirement savings. At
that
time, I
can get a 20 year conventional fixed mortgage, and pay the home
off
before
I'm 60.


Yeah, sure, whatever.......


Boy, you sure put a lot of thought into that reply. Sorry I taxed
your
brain so much.

The mortgage companies PUSH interest only loans to consumers. Care to
venture WHY????


Because they have a non-decreasing revenue stream coming in while the
principal is outstanding. So what. It's good for the bank...but even
better for me.

Are you smart enough to do the math on exactly how much *principle* you're
actually paying in the first 5 years of an $800000 mortgage at 4.25%?

I'll get you started:

Payment (principle+interest)= $3935.52
Payment (interest only)= $2833.33

(Answer= $66,131.20)

So at the end of 5 years, I'd owe $800,000...and the guy who paid
principle owes $733, 868.80.

Keep in mind that I'm putting that $66,131.20 into my wife's and my Simple
IRA's instead of towards the principle of the house. Because it's a
qualified plan, I saved $20k in Federal taxes over the schmuck who used
the money to pay down the principle on his home.

At the end of 5 years, he paid an extra $20k in taxes to the Feds, and
owes $733, 868.80 on the home.

At the end of 5 years, I put $66k into my simple IRA and paid $20k less to
the government. Even if the house doesn't appreciate, and I get *ZERO*
return on my investment in the Simple IRA, my net worth is ahead of his by
$20k. If I get even a nominal 5% return on my Simple IRA per year, I'm
even further ahead of the other guy.

Paying principle on a loan is an opportunity cost.

Unless you are in the bottom dwelling tax brackets like the "King of the NG
idiots"