What Kind of Mortgage Do You Have?
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How many of you have paid your home off? Good for you! The rest of us have a house mortgage that is probably the number one biggest payment (that is, if we’ve gotten rid of the pesky school loan and the credit cards!)
Even though this seems like a hard time to be in the market to buy a house (or at least to sell a house) it’s important to know how you will finance it once you find the house of your dreams.
The first time Virtuous Blonde and I bought a house (the one we are currently living in) we went with an FHA loan that let us get by with contributing very little to closing costs. This time around we’re still looking at Fixed Rate Mortgages because we’re concerned about what’s happening with people that have Adjustable Rate Mortgages and we don’t believe that we can have the luxury to gamble that we’ll be out of our next home in five years.
Right now we have a 30-year mortgage, which we’re paying bi-weekly payments (though we’re no longer doing that automatically, we’re doing it through our budget). We’ve been looking into 15-year loans, however, because they significantly lower the interest that you will pay the bank, and they are paid off sooner.
The only problem with them, that I’ve heard, is that the average mortgage lasts 7 years– meaning that people are usually out of their house in 7 years, not 15. To tell you the truth, when we find our next house we don’t know how long the Lord will keep us there. So we need to keep our options open.
Of course, if I were younger or had it to do over again, I might have purchased a two-family and rented out one half to get the mortgage down, or saved up and paid cash– definitely the best way to go.
What kind of mortgage do you have and how long until you get out?
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Comments from MInTheGap
Adam said,
Wrote on March 17, 2008 @ 1:33 am
I have a fixed mortgage on my house for 15 years and quite concerned about paying off after reading your post.
Adam
http://www.perfectmortgagelender.com/
AG said,
Wrote on March 17, 2008 @ 2:08 am Subscribed
We’re in a 30 year fixed, but are thinking we’ll have it paid off in five to seven years. My husban’d amazing with finances!
AG’s last blog post..Mary
MInTheGap said,
Wrote on March 17, 2008 @ 12:42 pm
That would be a really good thing if you could get it paid off that quickly. I think that we could do less than 5 years if we weren’t interested in moving and we didn’t take any vacations.
Dave Pulsford said,
Wrote on April 20, 2008 @ 7:02 am Subscribed
Depending on your circumstances here in the UK the flexible mortgage is becoming more popular and adaptable. As you now increase your payments and the loan gets paid off mush much quicker.