2007-03-11 14:43:28 · 5 answers · asked by commonsense 1 in Business & Finance ➔ Renting & Real Estate
Pay down the principal on your mortgage.
People don't realize the thousands of dollars in interest they will save over the life of the loan by paying even $500 a year extra towards their principal. Putting $10,000 towards the principal will knock 10 or 15 years off a 30 year mortgage. Most of the interest you are paying is in the first years of a mortgage. On a 30 year fixed mortgage, you don't even get to the point of having 50% of the loan paid off until the 23rd year.
2007-03-11 15:05:21 · answer #1 · answered by Faye H 6 · 0⤊ 0⤋
If you have been doing OK with making your monthly mortgage payments, please do not put his windfall into paying your mortgage down.
Put this money into some investment vehicle and leave it alone. This can be a nest egg for retirement or what ever, but it is not to be place as a buy down on your mortgage.
If you want and understand real estate investment you might purchase a duplex or a triplex for a rental property, which will give you a very small income, but over the life of the investment will yield tax advantages, appreciation and eventually a better income as the monthly mortgage payment remain the same but the rent on the units go up.
If not real estate find a money market, mutual fund or some other interest bearing account that exceeds 6% and invest you money in it. There are other and higher interest instruments, you h ave to seek them out from brokers.
I hope this has been of some use to you, good luck.
"FIGHT ON"
2007-03-11 15:15:50 · answer #2 · answered by Skip 6 · 1⤊ 0⤋
Not escrow -- that's a facility for doing an upcoming financial deal. Depending on the rest of your situation, you could put it into a savings account, a CD, an IRA of some kind, or some other sort of equity investment. I would not pay down the mortgage unless the interest rate on it is higher than 7.5%.
2007-03-11 14:56:43 · answer #3 · answered by Anonymous · 0⤊ 1⤋
No. You cannot put it "on interest" whatever that means, and the escrow is not due until it is due. If you make an extra payment it will go towards the principal balance.
2007-03-11 14:47:34 · answer #4 · answered by Anonymous · 1⤊ 1⤋
Depending on your market area, you may want to look into acquiring another property to produce income for you. If this is not an option for you, talk to your financial planner or a lender you trust for advice. Short-term CD's (6 Months) are at 5.09% today which is a safe choice while you are deciding what to do.
2007-03-11 14:50:15 · answer #5 · answered by carmensellsthehighdesert 3 · 1⤊ 1⤋