I agree with the mortgage tips from Terrance J. O’Brien.

Everything he suggests is perfect, it:

  • maximizes the value of your home
  • preserves your cash Liquidity
  • enables you to Use your cash when needed
  • helps you retain Control of your money

LUCKLiquidity, Use and Control – Keep it Yourself

To discuss how you can be LUCKY with your mortgage please contact me: info@DanielRotter.com

10 Mortgage Tips to Share 

  1. Wealth transfers with owning a house are inevitable. If you pay cash, you lose the ability to earn interest on that money. If you finance, you pay interest. The real issue is what’s most efficient.
  2. “Mr. Prospect, do you think you are in debt when you have enough money sitting in an accessible reserve fund that allows you to pay-off the mortgage with the stroke of a pen? Is that situation, a debt or a financial obligation?”
  3. Appreciation is the only thing that increases net worth in a house. The market determines its’ value.
  4. Making extra principal payments to reduce the mortgage does not increase the value of the house. It provides more security for the lender.
  5. A 30-year fixed rate mortgage is not sensitive to rising inflation rates. Your payment remains constant regardless of inflation. Wouldn’t it be great if we could strike a similar deal at the local grocery store, and lock-in our food costs for the next 30 years?
  6. The time to establish a Home Owner’s Line of Credit (HELOC) is when you don’t need the money. If you need the money, you probably won’t be able to secure the credit. The cost to establish the line is usually minimal, and you only pay interest on the money you borrow. Every home owner should consider establishing a line of credit.
  7. Leverage is a key factor when placing a mortgage on a house. A small down payment can control a high value house. The house appreciates on the total value of the house not just the down payment.
  8. Paying cash for a house is like burying money in a tin can in your  backyard. When the house is sold you dig-up the tin can and get the original price of the house less the purchasing power of those dollars which could be significant.
  9. Is the purchase of your house a lifestyle decision or an investment? To find out, subtract the original purchase price plus the cost of improvements from the estimated market value. Divide by the number of years in the house and you will get your actual returns. The results might surprise you.
  10. Mr. Prospect, I see you are thinking about taking-out a 15-year mortgage rate on the house because the interest rate is lower. If you ever got into a cash flow crunch during the next 15 years, because of a disability or loss of job, which mortgage payment would be easier to make, the 15 or 30 year mortgage?

It’s time to check-in! © Copyright Terrance J. O’Brien 2015