Newbie: need help. (Low income)

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Justinbc6
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Newbie: need help. (Low income)

Post by Justinbc6 »

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Last edited by Justinbc6 on Fri Feb 14, 2014 11:24 am, edited 2 times in total.
HurdyGurdy
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Re: Newbie: need help. (Low income)

Post by HurdyGurdy »

Justinbc6, what is your mortgage rate?
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Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

JuanZ I edited op to answer your question
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cflannagan
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Re: Newbie: need help. (Low income)

Post by cflannagan »

Justinbc6 wrote:Edit: unsure of mortgage rate. Taking over mortgage from my Dad who just passed and am just making payments so I don't have all the paperwork yet. I'm sure it's a decent rate though b/c he always had very good credit
Mortgage rate is also dependent on timing of when you got the loan (or refinanced). Even though he always had good credit, it might be high compared to today's rates and thus make sense to refinance. See if you can find the rate and update the OP.
Topic Author
Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

cflannagan wrote:
Justinbc6 wrote:Edit: unsure of mortgage rate. Taking over mortgage from my Dad who just passed and am just making payments so I don't have all the paperwork yet. I'm sure it's a decent rate though b/c he always had very good credit
Mortgage rate is also dependent on timing of when you got the loan (or refinanced). Even though he always had good credit, it might be high compared to today's rates and thus make sense to refinance. See if you can find the rate and update the OP.
Sorry, just went through all available paperwork and can't find it. I'll be able to get all that in a couple months when it gets transferred to my name... Perhaps you could give advice for both situations; good rate/ bad rate?
HurdyGurdy
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Re: Newbie: need help. (Low income)

Post by HurdyGurdy »

Justincb6, sorry for your loss. It seems you are doing all the right things (money for short term projects in bonds/CDs, long term in 80/20, good emergency fund, etc.)

Would you have a powerful reason for not paying that mortgage in full? in all likelihood, rate is above 3%.
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Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

JuanZ wrote:Justincb6, sorry for your loss. It seems you are doing all the right things (money for short term projects in bonds/CDs, long term in 80/20, good emergency fund, etc.)

Would you have a powerful reason for not paying that mortgage in full? in all likelihood, rate is above 3%.
No strong reason other than hoping to earn a better return than the interest rate by investing.
Luke Duke
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Re: Newbie: need help. (Low income)

Post by Luke Duke »

Justinbc6 wrote:Perhaps you could give advice for both situations; good rate/ bad rate?
Bad rate - pay it off or refinance
Good rate - continue to make payments

How much land will $30K buy you in your area? Would you use it (hunting, fishing, camping, 4 wheeling, lease to a cattle rancher, timber, etc.) or would it sit?
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BL
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Re: Newbie: need help. (Low income)

Post by BL »

If he was still on the original loan (not refinanced) he might be paying a high rate (over 9%!) for a 30-year loan. However, it is quite possible it was refinanced since the rates have been going down. It should not be that hard to find out where the payments are going so you can get that answer now. Even if it is fairly low, you are not likely to get that guaranteed rate anywhere else. Just use that payment money to gradually increase investments instead. Was he living in it? Will you live in the home, sell it, or rent it out? Renting is not a simple business for the inexperienced, and could come with unexpected costs and complications.

You don't have to decide immediately; there is no harm in keeping money in a bank for a year while you deal with your loss and learn about investing. Meanwhile, read one of the recommended books in the Wiki such as Boglehead's Guide to Investing. Don't let anyone talk you into any investing or insurance products. You seem to have a good idea on how to handle this.
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Jay69
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Re: Newbie: need help. (Low income)

Post by Jay69 »

I going to pick the other side of fence here. Unless the home mortgage rate is under 1% pay it off and have transferred to your name free and clear.
For 18k I say forget about having to deal with payments, making sure the mortgage company is listed on your home insurance for the next four years etc. s

Something to said about living and not paying the man.

My $.02
"Out of clutter, find simplicity” Albert Einstein
Topic Author
Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

Luke Duke wrote:
Justinbc6 wrote:Perhaps you could give advice for both situations; good rate/ bad rate?
Bad rate - pay it off or refinance
Good rate - continue to make payments

How much land will $30K buy you in your area? Would you use it (hunting, fishing, camping, 4 wheeling, lease to a cattle rancher, timber, etc.) or would it sit?
I

30k will get me somewhere between 10 and 15 acres. I would likely cut the timber and sell it w/ help from a couple family members, bale and sell the hay, and otherwise just let it sit.
Topic Author
Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

BL wrote:If he was still on the original loan (not refinanced) he might be paying a high rate (over 9%!) for a 30-year loan. However, it is quite possible it was refinanced since the rates have been going down. It should not be that hard to find out where the payments are going so you can get that answer now. Even if it is fairly low, you are not likely to get that guaranteed rate anywhere else. Just use that payment money to gradually increase investments instead. Was he living in it? Will you live in the home, sell it, or rent it out? Renting is not a simple business for the inexperienced, and could come with unexpected costs and complications.

You don't have to decide immediately; there is no harm in keeping money in a bank for a year while you deal with your loss and learn about investing. Meanwhile, read one of the recommended books in the Wiki such as Boglehead's Guide to Investing. Don't let anyone talk you into any investing or insurance products. You seem to have a good idea on how to handle this.
I will be living in the house for the next year or 2. It is a mobile home, so when i decide to build, i will either sell or rent, either way moving it to another location and building on the original land.
Ive read a few books, "investing for dummies" "mutual funds for dummies" and "the 4 pillars of investing" . Im obviously not an expert but think i know enough to not get suckered into anything that i shouldnt. I am planning to read the Bogleheads books over the next month or two.
Topic Author
Justinbc6
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Re: Newbie: need help. (Low income)

Post by Justinbc6 »

Jay69 wrote:I going to pick the other side of fence here. Unless the home mortgage rate is under 1% pay it off and have transferred to your name free and clear.
For 18k I say forget about having to deal with payments, making sure the mortgage company is listed on your home insurance for the next four years etc. s

Something to said about living and not paying the man.

My $.02
Advice taken.
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