Posted by MarkB_MI on March 08, 2014 at 06:55:38 from (75.219.104.64):
In Reply to: paying off mortgage posted by austin carpenter on March 08, 2014 at 06:18:21:
I have to agree with your friends, but perhaps not for the same reasons. Paying off your mortgage early makes sense if you have a high interest rate or many years left to pay. It really doesn't make good financial sense for you, because you have a dirt cheap interest rate and 15 year mortgage.
I can say one thing about interest rates with absolute certainty: THEY WILL GO UP! As discussed in an earlier post, the Fed discount rate is essentially zero, so the only possible direction for interest rates to move is UP. You are locked into a 3.25 percent interest rate loan for the next 15 years. THAT IS A BARGAIN! Let's say you take that money you would pay against the principal and put it in the bank. Five years from now let's say you want to buy a second property and the interest rate for mortages is now 6 percent. You can use the money you put away against the principal of the new house, essentially paying only 3.25 percent interest for that amount versus 6 percent for the rest of the balance.
Another way to look at it is this: If you pay down your mortgage now, you're getting an effective return of 3.25 percent on your money. That's better than bank interest, but not much. The stock market has been doing much better than; the long term return for the DJIA is around ten percent. Did I mention that interest rates will be going up? You'll feel silly about paying down your 3.25 percent mortgage if bank interest rises to, say, 4 percent.
We sell tractor parts! We have the parts you need to repair your tractor - the right parts. Our low prices and years of research make us your best choice when you need parts. Shop Online Today. [ About Us ]
Today's Featured Article - Restoration Story: Fordson Major - by Anthony West. George bought his Fordson Major from a an implement sale about 18 years ago for £200.00 (UK). There is no known history regarding its origins or what service it had done, but the following work was undertaken alone to bring it up to show standard. From the engine number, it was found that this Major was produced late 1946. It was almost complete but had various parts that would definitely need replacing.
... [Read Article]
Latest Ad:
1964 I-H 140 tractor with cultivators and sidedresser. Starts and runs good. Asking 2650. CALL RON AT 502-319-1952
[More Ads]
All Rights Reserved. Reproduction of any part of this website, including design and content, without written permission is strictly prohibited. Trade Marks and Trade Names contained and used in this Website are those of others, and are used in this Website in a descriptive sense to refer to the products of others. Use of this Web site constitutes acceptance of our User Agreement and Privacy Policy
TRADEMARK DISCLAIMER: Tradenames and Trademarks referred to within Yesterday's Tractor Co. products and within the Yesterday's Tractor Co. websites are the property of their respective trademark holders. None of these trademark holders are affiliated with Yesterday's Tractor Co., our products, or our website nor are we sponsored by them. John Deere and its logos are the registered trademarks of the John Deere Corporation. Agco, Agco Allis, White, Massey Ferguson and their logos are the registered trademarks of AGCO Corporation. Case, Case-IH, Farmall, International Harvester, New Holland and their logos are registered trademarks of CNH Global N.V.
