Cannot believe the interest rate I got on a 30 year.

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Originally Posted by alarmguy
Originally Posted by JeffKeryk
Originally Posted by SouthDakotaDad
I'm pretty pumped. Got a 2.6% fixed rate on a 30 year mortgage for my home. I am absolutely shocked and never thought I'd see the day that a rate like that wasn't a 15 year loan. Wanted to do a 15 year like Dave Ramsey recommends, but just didn't want to commit to such a larger payment at this time.

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Well done; close to free $$.
Dave Ramsey is for people who are in financial trouble; I disagree with a lot of his assumptions.
As others have posted, put extra into the loan and you can mimic a 15 year term.
Good luck and pay that sucker off!


Actually your 200% wrong but don't want to hijack this thread, read up, read a book go to Dave Ramsey's website.
He is about building wealth and not having to borrow money from other people and banks to buy things.
You have it backwards, borrowing money to buy things is for the poor.
The rich and self sufficient do not.
It is true he and his mission is to help people get out of debt and be independent of borrowing money, now isn't that a good concept!


Ramsey is for people who are in financial trouble; his guidance is a set of steps to get out.
Getting out of debt and achieving financial independence are great goals.
Let's just say I do not need his guidance.
I am not sure what you think I have backwards.

Mr. Ramsey's mission is to make money. He's doing quite well.
 
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We got 4.25% on a 30 year conventional, but we did a low down payment loan, 3% or 3.5%. Our PMI will drop off once the loan hits 80% LTV. I do not plan on paying on it for 30 years though.
 
Originally Posted by SouthDakotaDad
I, but just didn't want to commit to such a larger payment at this time.

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Just go ahead and make payments like its a 15 year loan. If you have a tight month then make the 30 year payment, but go back after. The more you pay extra the first few years knocks down the principle.

Some people keep refinancing 30 year loans for lower payments, and don't realize they are making perpetual interest payments. Think how you will feel if you have no house payment!!!
 
Originally Posted by spasm3

Just go ahead and make payments like its a 15 year loan. If you have a tight month then make the 30 year payment, but go back after. The more you pay extra the first few years knocks down the principle.

Some people keep refinancing 30 year loans for lower payments, and don't realize they are making perpetual interest payments. Think how you will feel if you have no house payment!!!

Good advice.
Refinancing is OK if you can lower your interest expense.
This assumes you make payments in excess of the normal payment.

I can tell you owning your home outright is an incredible feeling. You will sleep like a baby...
As time goes by and housing costs rise, it is even more amazing.
And in the end, you just might leave someone a really nice inheritance. All good.
 
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Originally Posted by JeffKeryk
Originally Posted by alarmguy
Originally Posted by JeffKeryk
Originally Posted by SouthDakotaDad
I'm pretty pumped. Got a 2.6% fixed rate on a 30 year mortgage for my home. I am absolutely shocked and never thought I'd see the day that a rate like that wasn't a 15 year loan. Wanted to do a 15 year like Dave Ramsey recommends, but just didn't want to commit to such a larger payment at this time.

banana2.gif
13.gif




Well done; close to free $$.
Dave Ramsey is for people who are in financial trouble; I disagree with a lot of his assumptions.
As others have posted, put extra into the loan and you can mimic a 15 year term.
Good luck and pay that sucker off!


Actually your 200% wrong but don't want to hijack this thread, read up, read a book go to Dave Ramsey's website.
He is about building wealth and not having to borrow money from other people and banks to buy things.
You have it backwards, borrowing money to buy things is for the poor.
The rich and self sufficient do not.
It is true he and his mission is to help people get out of debt and be independent of borrowing money, now isn't that a good concept!


Ramsey is for people who are in financial trouble; his guidance is a set of steps to get out.
Getting out of debt and achieving financial independence are great goals.
Let's just say I do not need his guidance.
I am not sure what you think I have backwards.

Mr. Ramsey's mission is to make money. He's doing quite well.


Did you miss something here? Did you read the OPs post?
Its not about you.
Im glad you agree getting out of debt are great goals, having a mortgage and other debt is most all of the country. (sadly)
and most have no clue the real out of pocket cost of that debt. Meaning interest they pay on a 15 year mortgage instead of a 30 year. Its exactly what Dave Ramsey teaches.


So here is what you have backwards (and the end of this discussion for me)
You state "Dave Ramsey is for people in financial trouble." Wrong you are, its for everyone who wants to learn about financial responsibility which includes everyone on the planet who borrows money to buy stuff.
It means being your own bank.
You dont have to agree, I could care less but you talk him down and seem jealous or something.
The people who take his advice have no debt or work towards no debt and many in their 30s and 40s with paid off homes and other investments making them in the top 10% in the country.
 
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Originally Posted by SouthDakotaDad
I'm pretty pumped. Got a 2.6% fixed rate on a 30 year mortgage for my home. I am absolutely shocked and never thought I'd see the day that a rate like that wasn't a 15 year loan. Wanted to do a 15 year like Dave Ramsey recommends, but just didn't want to commit to such a larger payment at this time.

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I am hearing 2.5% is what they're at right now. Quicken Loans got 10 million refi applications this last weekend. One of my gym partners is in the business for corporate. I am at 3.75% 30/fixed, so not really worth it for me, but a VERY good time if you're in the market!
 
Originally Posted by alarmguy


Did you miss something here? Did you read the OPs post?
Its not about you.
Im glad you agree getting out of debt are great goals, having a mortgage and other debt is most all of the country. (sadly)
and most have no clue the real out of pocket cost of that debt. Meaning interest they pay on a 15 year mortgage instead of a 30 year. Its exactly what Dave Ramsey teaches.


So here is what you have backwards (and the end of this discussion for me)
You state "Dave Ramsey is for people in financial trouble." Wrong you are, its for everyone who wants to learn about financial responsibility which includes everyone on the planet who borrows money to buy stuff.
It means being your own bank.
You dont have to agree, I could care less but you talk him down and seem jealous or something.
The people who take his advice have no debt or work towards no debt and many in their 30s and 40s with paid off homes and other investments making them in the top 10% in the country.

You seem to make assumptions about me.
I am hardly jealous of Mr. Ramsey; if he helps people that's a good thing.
I just disagree with his general plan. I used to listen to him.
I believe personal finance should be taught in school. No one should get outta 8th grade without an understanding of banking and credit.
No one should get outta high school without training in personal finance including the time value of money, markets and taxes.

FYI, if I followed Mr. Ramsey's plan, I would be no where near my total worth today. Not even close.
My plan was to minimize cost while maximizing long term investment, with contingency plans. Especially in myself.
I was broke and homeless in my mid 20's. Let's just say that is no longer the case.
Oh yeah, many come to me for financial advice. There is a reason for it.
 
OP=
Example for 15 yr vs 30

Lets says 300,000 actual mortgage.

Interest paid on a 15 year mortgage at 2.75% = 66,455.68

Interest paid on a 30 year mortgage at 2.75% = 149,000.48

Of course we are at historic lows right now, you can imagine the difference with higher rates.
It always pays to pay additional monthly principle on a 30year mortgage.
 
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Originally Posted by SouthDakotaDad
I'm pretty pumped. Got a 2.6% fixed rate on a 30 year mortgage for my home. I am absolutely shocked and never thought I'd see the day that a rate like that wasn't a 15 year loan. Wanted to do a 15 year like Dave Ramsey recommends, but just didn't want to commit to such a larger payment at this time.

banana2.gif
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For the present , if the budget will let you , simply mail in 2 payments each month . You get in a bind , drop back to 1 payment a month .
 
Originally Posted by PimTac
2.6% surely beats my first mortgage which was at 16.25%. That was many moons ago.

Many people have no clue what went down in the 80's with rates. This is what blows my mind about so many younger people who are complaining about "how hard the American dream is today..."
 
Minimizing interest expense is generally a good thing, especially if you consider it in a void. Except you don't live in a void.
If you pay 3% on a loan but can get 5% on an investment, you should at least consider balancing your output.
Over time, the S&P returns a much higher percentage than home interest rates.
Keep in mind risk; risk is difficult to quantify but is critical to results.
In my case, I could have made more money if i had invested more in the market but choose to strongly focus more on paying off my house. So I did both as best as I could.
Why? I wanted to minimize risk against rising cost of housing and believed in Silicon Valley.
My goal was to be able to tap home equity, as a contingency plan.

I drove used Accords and Toyota 4 banger pickups. Cars are depreciating assets.
Don't put $$ into depreciating assets and do put $$ into appreciating assets.
The 1st thing to understand is opportunity cost. Your money only spends once.
The 2nd thing is timing. Timing is only everything. Except maybe luck...
 
Its a good deal if you are less than 5 years in on a 30 yr. If you are over 5 years in, the restarting of the 30 yr clock might not be worth it when that lower payment comes with another 30 years of paying off that loan, There is a point in time where the costs associated with refinancing the loan are equal to the savings . I pay 5.5% which was good back in 97 when we bought our home so with about 7 years to go it's not worth it to us. We can finally almost see the light at the end of the tunnel and its not a mortgage bill.
 
Just read that many of the online sources, including Zillow and Trulia are advertising much higher rates because they are overwhelmed with the refi demand.

I don't really know how to get a true rate these days, but the lowest I've heard of lately was 2.65% for a 20 yr.
 
Originally Posted by JohnG
Just read that many of the online sources, including Zillow and Trulia are advertising much higher rates because they are overwhelmed with the refi demand.

I don't really know how to get a true rate these days, but the lowest I've heard of lately was 2.65% for a 20 yr.




True rate? = walk into your local banks, 1 commercial bank, 1 savings bank and 1 credit union, you will be able to get the correct information face to face. Then if you wish you can compare to the stuff on the net.

All you need to find out is the rate and what costs are involved to get to the closing table.
 
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Originally Posted by alarmguy
Originally Posted by JohnG
Just read that many of the online sources, including Zillow and Trulia are advertising much higher rates because they are overwhelmed with the refi demand.

I don't really know how to get a true rate these days, but the lowest I've heard of lately was 2.65% for a 20 yr.




True rate? = walk into your local banks, 1 commercial bank, 1 savings bank and 1 credit union, you will be able to get the correct information face to face. Then if you wish you can compare to the stuff on the net.

All you need to find out is the rate and what costs are involved to get to the closing table.
 
My take on 30 year vs 15 year. Always go 30 because home interest is less than actual inflation. At 2.75% i will pay an interest portion of $900 a month to live in a home that would rent for 2500 or more today. I have >20% equity and my actual cost is the 900 interest and about 275 for tax and insurance. The rest of the payment is equity/savings in my view. So i take 30 years and invest the rest. I dont have to take high risk to beat 2.75. Will i prepay? Maybe a small amount, 40k saves over 40k in interest but 80k does not save you 80k.
 
Originally Posted by Skippy722
We got 4.25% on a 30 year conventional, but we did a low down payment loan, 3% or 3.5%. Our PMI will drop off once the loan hits 80% LTV. I do not plan on paying on it for 30 years though.

I ended up with 3.75, 0 down, and PMI is $55/mo, dropping off automatically at 20 or 22%, but I can request it removed at 17-18%, I believe. RD loan FTW!
 
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