That's what's keeping me depressed. It appears I may have lost all of my downpayment due to a market correction. I don't want to pay a mortgage anymore. I was close to being out of my mortgage payment before this market correction. Thanks for your advice.
What in the world am I supposed to do? I feel like I'm in prison.
2006-07-23 01:47:23 · 3 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
What is keeping you depressed? The fact that you have a mortgage or the fact that you have the responsibility of a mortgage?
A mortgage can be a means to building wealth if you understand the way money works and utilize it as such. It is generally the cheapest money you can borrow and offers the best if not only tax deduction some people have. A 7% mortgage is only costing you about 4.5% to 5% or less if you factor in the tax deduction.
If you use funds to pay down or pay off a mortgage that could otherwise be used to create wealth, then it is like putting money under a mattress! It is great to have but it does absolutely nothing for but make your mattress lumpy and is even under more risk if someone breaks into your house and steals it.
If you were to lose your job or means of support, all of the equity in the world will be difficult to access, since a lender is not going to lend you money without a job!
My suggestion to you is to find a financial advisor who understands how to harness the power of your mortgage and then get busy. I would also refinance if your current mortgage is not working for you. If you don't refinance, don't sweat the current mortgage. Use the tax break you are getting. Begin looking for a suitable long term investment vehicle to compensate for the interest. Hopefully you will be getting more than 4.5% on your investments. Conservatively, you should expect 8% and higher.
If the monthly payment is a problem, then you need to find a way to increase your income. Second job, home business (which offers even more tax deductions) etc. Even just cutting back on what you have now. How much are you paying for cable tv, unused phone services, cell phones, cigarettes, alchohol, any other vises, magazines, newspapers, dining out. Dining out is my wife and I's biggest overhead expense. With what I spend in that catagory I could have paid off my mortgage!
You get the picture. If you need some advise, feel free to email.
2006-07-23 02:55:13 · answer #1 · answered by Sam B 4 · 1⤊ 0⤋
I am a real estate agent in Alabama.
Sounds like you got a loan that floats with the lending rates banks charge for loans - instead of a fixed rate. And the Fed has raised that rate several times recently because the economy is supposed to be
"healthier."
Talk to your real estate agent if you have one. Ask if you can refinance under better terms, i.e. a fixed rate.
We almost all have monthly payments for a house, it goes with the territory. And . . .why not get "into" your home, do some landscaping, plant some gardens - think about a jacuzzi or pool for later perhaps - all things which add to the value of your house.
If you feel you are in over your head with the payments, plan ahead before if there is a threat of foreclosure in the future . . . consider downsizing, i.e, selling your house and moving to a smaller one with lower payments. Anyway, hope it all works out for you.
2006-07-23 09:22:34 · answer #2 · answered by Anonymous · 0⤊ 0⤋
Dedicate yourself to paying it off. Make double and triple payments. Don't expect to obtain something good without effort. Don't think that is what is keeping you depressed. It's not.
2006-07-23 08:52:21 · answer #3 · answered by Anonymous · 0⤊ 0⤋