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Holein1JL: with most people spending more than they make now, where does the extra principal payment come from Money Whiz: Do you buy into real estate broker theory, that is.. TOYOTATOO: did u get my ? money whiz? KJM0101: WHat is the benefit of no points/ higher interest? Money Whiz: that a wanna be homeowner should buy the Money Whiz: most house they can afford? SirromDS: Second house bought for 289K with a 50K mortgage - because Smksprk4: good evening SirromDS: we had 100% equity from the first house - a very important benefit of paying off the mortgage. Holein1JL: less up front money McLeod1997: Any opinions on TAMI mortgages SPeters67: are you better off paying off mortgage early or investing in a mutual fund ? Money Whiz: <yes, TOYOTA, up next> TOYOTATOO: thats an easy one speters paying off the mortgage Bdpeep: agreed Toy SirromDS: MW - I recommend being 1.) realistic - what you truly can afford and 2.) patient - knowing your next house Holein1JL: unless you like taking risk SirromDS: will be bigger - if you want, or you'll have no mortgage at all. AUCADO: agreed, toy, then pay off credit cards.... TOYOTATOO: but u still need to keep some cash around Smksprk4: how much benifit to adding $100.00 per month to principle? Bdpeep: so David you say one should buy a smaller home to build equity TOYOTATOO: what are credit cards? Money Whiz: So does this mean you should buy a smaller home, then, Money Whiz: to build equity? Holein1JL: ask my wife Bdpeep: and turn that into a larger house down the road?? JPCallag: What about the idea that having a house mortgaged - you keep yourself leveraged when young thus leaving more AUCADO: You'll get one when you're older.. JPCallag: money for investment elsewhere? JCebal: Is using a home equity loan on 1st house to buy 2nd a good idea? SirromDS: SMK - add as much as you can $100 will certainly help, but more is better - use your money wisely every day <B>Big Sell-Off:</B> Despite the Fed's decision to stand pat on rates, <A HREF="aol://4344:1632.mday.13380028.556461909">stocks plunged</A> on Wall Street. <A HREF="aol://5862:170/CHART,US,$INDU,D,A">DJIA</A><A HREF="aol://5862:170/CHART,US,COMP,D,A">Nasdaq</A>11/12 ET <A HREF="aol://5862:170/CHART,US,SPX,D,A">S&P 500</A>David Solomon <A HREF="aol://4344:543.G_1008.3933468.558218380">LIVE</A> at <B>6pm</B> ET!Get a daily NAV for your funds. 7401.32 -157.411541.72 -43.14905.96 -17.8216:08RAVENHH: I just locked in at 7.375% 30 yr fixed. Good? SirromDS: you'll have more for the mortgage - that's the key - saving every day$ Money Whiz: What about bi-monthly mortgages, do you think they are beneficial? Bdpeep: yes Rav pay down whenever you can Money Whiz: <RAVENHH: actually, that is good. Ever hear of Bank Rate Monitor?> Jasperrob: I want to get your feedback on this -- a yes or a no KJM0101: Why would you want to pay down your mtg when the interest is a tax benefit and youcan invest the difference at SirromDS: JP - I believe it's better to eliminate the mortgage, Save tens of thousands in mortgage TOYOTATOO: no, who is that? KJM0101: a higher return? MShupp9296: what is the best option-pay points or higher rate? Bdpeep: agreed David, pay yourself the money instead of the bank!! Jasperrob: Is it true that at any time you can borrow at a rate less than that at which you can invest... you borrow TOYOTATOO: how do u eliminate the mortgage? SirromDS: interest - which you pay up front and for many years, before building equity, Then make larger investments Jasperrob: Fee free rules I challenge anyone to prove me wrong K3101: whts fee free JPCallag: what if you are considering it an investment property and not a primary residence? SirromDS: every month - Since you have no mortgage - you have more to invest! Money Whiz: David, ready for the next question?? Bdpeep: which do you prefer ARM or fixed rate?? Jasperrob: because when we pay fees we lose opportunity costs for our money the same as when we pay points KJM0101: The key to investing is starting early and compounding interest... why not invest now instead of later and hav KJM0101: e it working for yoU? SirromDS: JAS - Please look at the Dollars PAID every month to the bank - hundreds!! Jasperrob: 30 year fixed is better today because of the small spread -- risk avoidance SirromDS SirromDS Bdpeep: agreed Jas SirromDS: and compare that to the Dollars Earned every month from investments - that's how RAVENHH: No, on Bank Rate Montitor. NRVPOD2: what about the idea ofmaking one extra mtg payment a year Bdpeep: oops 30 year ARM is my thoughts if you can get a 1-5 cap Jasperrob: not to mention 30 yr allows the broker to pay all costs -- points and fees SirromDS: lenders have the money to loan - they get the money up front - more to interest than principal Jasperrob: talk to me people Money Whiz: <RAVEN: go to http://www.bankrate.com, to compare mortgage rates in your area.> Jasperrob: what is your method of paying it early SirromDS: for 20 years on a 30-year loan!! RAVENHH: Thanks!! McLeod1997: hey rob any thoughts on TAMI mortgages JCebal: moneywhiz did you get my ? SirromDS: MW - Didn't get last message, sorry$ TOYOTATOO: PLEASE GIVE US DIRECT ANSWERS AND STOP DANCING AROUND THE QUESTIONS TO SELL YOUR BOOKS! Money Whiz: David --- I'll pull the questions from audience so you can Jasperrob: kudos Money Whiz: focus on them one at a time.. Money Whiz: TOYOTA: calm down, and stop "shouting", meaning Jasperrob: put me online and I'll show you why the 30yr fee free rules Money Whiz: turn off your caps. K3101: ha ha toyota Money Whiz: We're working with you here, TOYOTA, and I've got some Bdpeep: Toy kill the caps bud LDAVIS2247: LA GEAR BUY OR SELL Money Whiz: questions for the guest. Stand by, ok? TOYOTATOO: PASS the news to himthen...thanks> Bdpeep: LD we are here for morts not investing!! Money Whiz: Since I own a TOYOTA, you betcha. ;) Bdpeep: thanks Toy Jasperrob: lets talk mortgages TOYOTATOO: get er done! TLOLSON: What would be a good investment vehicle for income to apply to my monthly mortgage? I would have 30k to inves Money Whiz: David: What if you wanted to borrow against your house, via a HELOC, Money Whiz: to buy ANOTHER house----a worthwhile move? Jasperrob: host -- how do you propose -- equity acceleration Jasperrob: ?? Holein1JL: hey toyota go easy on the caffine Bdpeep: lol hol Money Whiz: <Jas: Please, feel free to call me Whiz. ;) We'll get that one next! > SirromDS: MW - I suggest paying off the first mortgage first, eliminate debt, rather than taking on a new debt - Jasperrob: why apply money to mort... invest it the mort is cheap and tax ded Holein1JL: What does lol mean SirromDS: be patient$ Jasperrob: lots of luck Bdpeep: laughing out loud Jasperrob: yeahhhh Money Whiz: David, you mentioned that the strategy Jasperrob: righty ACarl97820: Laughing out loud Money Whiz: to pay off your mortgage is simply Money Whiz: paying more into the principal. JPCallag: MW - i tried to go to bankrate.com - not possible - any spaces? TLOLSON: The mort is cheap/tax deduct..I want to use part of income to pay on principal Money Whiz: Now, exactly HOW MUCH do you pay into the principal to Money Whiz: make a difference? Bdpeep: JP try later hon, we will get you there ok?? Money Whiz: <JPCallag: try keyword: BRM here on AOL.> Jasperrob: paying more into a 7-8% rate when investments... even lame ones get 9%.. where is the logic Jasperrob: let alone the tax ded Bdpeep: security Jasperrob: brings eff rate to 6.5 SirromDS: MW - that depends on the individual - the most you can pay as early as possible Jasperrob: security? SirromDS: will give you the greatest savings in interest dollars and build equity faster$ TLOLSON: Paying off mortgage early is logic....save on interest .... DBurnett7: JP - I dont look at paying my mortgage down as an "investment" per say, but ....... Money Whiz: Forgive me if I'm repeating, but what is your opinion Money Whiz: about bi-weekly mortgages? Jasperrob: no early payoff you lose... Bdpeep: pay yourself instead of bank Money Whiz: We love specifics. DBurnett7: paying an extra measly 100 dollars a month on a 100000 mortgage cuts K3101: thaats right whiz DBurnett7: almost 9 years off the mortgage Jasperrob: if inv yield in excess of that mort rate... why pay early SirromDS: MW - It's not necessary to make bi-weekly payments, one check which includes the extra to principal is Jasperrob: people wake up it makes no cents... financially .. maybe emotionally Bdpeep: if you feel you can do better than do it Jas we are trying to Kathjost: Is now a good time to refinance and adj. rate morg Bdpeep: hear the mans theory here thats all!! SirromDS: easiest and the best - just highlight the amt. ETP on the check and statement$ TLOLSON: If I pay mortgage off early, i can enjoy retirement even more... K3101: what the hell is jas tlaking abotut Money Whiz: So, what you're saying then, KJM0101: I disagree with the one check idea... Always make a second check because then you have a separate record of pm KJM0101: t JCebal: Our bank charges an initial fee of $400 to get into bi-weekly payments. Is that standard? Money Whiz: is forget bi-weekly mortgages, and instead, Jasperrob: second check if doing it absolutely Money Whiz: opt for a strategy of adding more $ to your principal, right?? DBurnett7: Something about ownership, Jas....nice being out of debt Bdpeep: I have loan in CU can make extra payments daily!! K3101: dont think so jc Money Whiz: <Suggestion, audience: Might want to make that add'l principal payment a separate Bdpeep: hourly by the second if I want KJM0101: Most people are paid biweekly and it is easier for them bookkeeping wise... Money Whiz: <check and mark on the check that it is to be directed toward principal.> SirromDS: MW - Yes, exactly - less complicated and same results, just make sure the ETP is applied to the principal, Jasperrob: something about large portfolio DoktrDon: cebal-- your bank is a rip SirromDS: check the statement the next month. Bdpeep: Whiz does David prefer a fixed or an ARM?? Jasperrob: I own a home too but I use the equity to invest in real estate every 3 years Bdpeep: 15, 30 or what?? Jasperrob: 30 -- invest the diff DBurnett7: to each his own..........Some people dont want to be slaves to the bank for 30 years Bdpeep: congrats Jas Bdpeep: agreed Jas just wanted to know David's thoughts DBurnett7: Trust me, I believe in investing as well..... JBres2129: I have and 8 and quarter mtg would it pay to refinance even though there are many charges Money Whiz: With the Fed not changing interest rates today, which way would you go: Money Whiz: ARM or fixed? Jasperrob: let the bank be your slave -- if its economic decision then fine but dont disput the amth Jasperrob: math JCebal: so doktron I'm better off just making the xtra payment towards the principal? Money Whiz: <JBres: rule of thumb on refinancing, new mortgage rates should be KJM0101: I have a 7 3/8 mtg... I make 1 pmt more a year... and invest the rest in 12% plus...I will come out same if no KJM0101: t better Money Whiz: <approx. 2 points lower than your original rate to make it worthwhile.> Jasperrob: see you all -- I want some light shed JBres2129: 30 year fixed they have 6 and five eighth i point for 30 years DPITZER529: HOW DO FIND SMALL CAP STOCK ONLINE SirromDS: I like the fixed for the first mortgage, then, after your used to managing money and making ETP payments, the Bdpeep: What about if you are just taking on a mort?? Bdpeep: sorry answering DoktrDon: dont like those "offers" of biweekly plans for upfront fees Holein1JL: rent SirromDS: second house may have an ARM - it depends on your comfort level. TLOLSON: jasper, my original question still stands about good investment for monthly income Jasperrob: they keep the money and earn on your dime TOYOTATOO: what does ''ETP"" stand for? Jasperrob: email me for further professional advice jasperrob@aol.com Money Whiz: David, for those of us who don't know, can you Money Whiz: define ETP. Jasperrob: by by DBurnett7: Professional?? Money Whiz: <And Jasperrob, that is a violation of TOS.!> Bdpeep: David could you give us a scenario of savings?? Money Whiz: <We DON'T ACCEPT solicitations in here.> SirromDS: Sorry, ETP = extra to principal$ KJM0101: PLUS when you buy in location... equity is also built by increase in value... not necessarily cash in Jasperrob: yeah burny baby Money Whiz: Thanks David! TOYOTATOO: you are doing a good job Money Whiz Money Whiz: <Thank you TOYOTA> Money Whiz: David, what is your knowledge of TAMI mortgages? 60 Bdpeep: <-- clapping for Whiz and David!! Holein1JL: whiz what is TOS SirromDS: MW - zero, unless there's another name$ Money Whiz: <TOS = Terms of Service. ie., the "rules" of being online> Holein1JL: thanks Money Whiz: What about refinancing in today's interest rate market? Money Whiz: Your thoughts, David? Money Whiz: I mentioned the rule of thumb Money Whiz: is that the new rate should be approximately Money Whiz: 2 points Money Whiz: less than the original rate. Money Whiz: Is that true, and what is your opinion? Bdpeep: Hol, jas came to sell us his services an AOL nono User952615: where do you find the lowest rate? do you need to visit a lot of local banks or is there an easier way? SirromDS: Very low rates make refinancing very attractive, you have to do the math to see about the Holein1JL: yea that is going to be my next purchase Money Whiz: <User952: Great resource is Bank Rate Monitor. Keyword: BRM> Bdpeep: thanks Whiz Holein1JL: check the business paper or call real estate person MShupp9296: is it best to pay points and buy down the rate ? KJM0101: SO, your basic principle is that you pay extra on your mtg every month to pay down... what else SirromDS: break even point - how long will it take for the savings to equal the closing costs? If you can get no points, RSaunde328: David, in today's market, would you more readily buy an older home or a newer one? SirromDS: less than 2% difference may be okay$ Bdpeep: depends on hood Rs Money Whiz: Thanks, David, and we're also wondering if it Money Whiz: is best to pay points and buy down the rate? RSaunde328: What do you mean by "hood"?i Holein1JL: old sucks Bdpeep: the area, sorry Bdpeep: not true Hol SirromDS: Again, you have to do the math; but remember if you're aggressively paying extra to principal, then Money Whiz: <I'm with Holein on that one, but I'm high-maintenance person gleaning a low-maintenance lifestyle. :-)> KJM0101: some old are better built and in more desirable areas than new, hol Holein1JL: maintenace will kill you Bdpeep: lol Whiz, lazy &^%$ KJM0101: Not necessarily DoktrDon: is the int. rate when points=0 and orig fee= 0 the best way to compare? K3101: then what SirromDS: you will increase your savings over a short period of time - because the amount you pay to interest every Denka 2: I feel that newer homes appreciate quicker than older ones F I SEIDO: I have a ARM that is now at 8.25 I can Lock into a conv at 8% for 250.00 should I switch or wain Holein1JL: as will utilities KJM0101: Depends on how long you are going to keep it...If for investment purposes, maintnce may be minimal SirromDS: month in the basic payment goes down rapidly and the amount to principal SirromDS: increases fast$ Holein1JL: keep it at least 18 months or so will capital gains Money Whiz: Ok, here's another one: Money Whiz: When shopping for a mortgage, and, assuming SirCG: What percentage over the basic payment must be made to pay off a 30-year mortgage in 10 years? Money Whiz: the points = ZERO, and the origination fee = ZERO, Bdpeep: what are new tax laws that deal with real estate?? RSaunde328: Is there generally a fee for following an amortization schedule and repaying the mortgage much earlier? K3101: the bank sent me a plan where I could pay my mortage of in six years- do you beleive that they have an alternv Money Whiz: is the only thing you compare the interest rates then? KJM0101: Again...location is key...in old vs new User952615: Do all lenders require 20% equity before cancelling the PMI? K3101: alternative motive Bdpeep: agreed KJ Holein1JL: PMI can be neg. Bdpeep: location location location, unless it is a life home!! TOYOTATOO: pmi is negotiable up front with good credit in some cases SirromDS: All things being equal - yes; the loan will probably be sold on the secondary market anyway$ Money Whiz: User952 has a GREAT question... Bdpeep: 20% negates PMI Holein1JL: with banks anything can be neg. Money Whiz: Do all lenders require 20% equity before cancelling PMI? I Money Whiz: recall a few months ago.. Money Whiz: there being a lot of scuttlebutt about Money Whiz: this issue, and that many homeowners KJM0101: Did you pay off you first mtg completely or was part of it appreciation that you rec'd when you sold to roll t KJM0101: to new one? Money Whiz: have more than 20% equity, but they're Money Whiz: STILL paying PMI! Money Whiz: What's the truth, David? Bdpeep: Banks are a place that will loan you $ if you can prove you don't need it!! SirromDS: PMI - That's the usual,; but it's up to you to know when you reach 20% and notify the bank; the bank's not KJM0101: no kidding bdp... they loan out your money at 18%and keep 15% giving you 3 if lucky SirromDS: going to call you; also, the 20% represents true equity, not change in property value$ Money Whiz: Did you hear that folks? If you think you have more than 20% equity, and you're currently paying Bdpeep: Really, David the Feds changed that last year did they not??? Money Whiz: PMI, call YOUR LENDER. Holein1JL: would you loan to someone who really needed it SEAMSEALER: do you reccomend a low interest equity loan to purchase other high yield investments....I.E. Real estate Money Whiz: David, let's talk for a minute about some numbers. Bdpeep: made it illegal for lendors to collect more than x % DoktrDon: how do you figure the "true equity"? Money Whiz: Let's assume that we have a $100,000 mortgage. Executecnv: how do you pay off in 2 years Money Whiz: And we want to reduce the interest we're going to pay over the Money Whiz: life of this 30-year loan. Bdpeep: simplest is what you paid, ignore increase in value Money Whiz: Your strategy is to pay more each month, and apply it Money Whiz: to the principal. Money Whiz: You call it "ETP." Bdpeep: that is bonus for short/long term Money Whiz: Can we plug in some numbers to see Money Whiz: what exactly happens? Money Whiz: Meaning, if you add $100 more per month, Money Whiz: you'll reduce your loan balance by XXXXX over XXXX years? Money Whiz: Thank you. Bdpeep: good ? Whiz!!!! an example hoorah! K3101: be specific remember Bdpeep: lol K3 Money Whiz: Feel free to use your calculator, I know this is something Money Whiz: that alot of the audience would like to know. SirromDS: Yes, at a 7.5% interest, if you add $100 ETP every month starting on day one, KJM0101: Yeah... specifics would be good right about now... stategies other than common sense Bdpeep: or abicus David!! Money Whiz: <KJM: in all seriousness, and respectfully, not everyone knows Money Whiz: <these things are common sense> Holein1JL: and yet they own a computer Bdpeep: KJM this is impresive when the #s are demonstrated for those who have not done math K3101: low blow or not JCkats5634: 78k is left on my loan- with 6 years to pay to finish. does it make sense for me to refinance this 15 year lo Y Heineken: i suppose Money Whiz: <no low blow, I think KJM is lucky that he knows all this stuff, I interview> PINEZAAP: pinezaap entered the room Bdpeep: low Money Whiz: <hundreds of average Joes and Janes who don't.> KJM0101: I wasn't meaning any disrespect... but... stategies is what I believe we are all after Bdpeep: on KJMs part Bdpeep: sorry KJM we are over it hon Money Whiz: <We're in total agreement, KJM :-) > Bdpeep: kiss kiss hug hug K3101: I agree to that very much so kj SirromDS: you'll save approximately 50K over the life of the loan, and the loan will be paid off in about 19 years, SirromDS: saving 11 years. FOC723: i have a question just recently refinance an adjustable 7.785 TOYOTATOO: best way to figure equity is to pay for a new home appraisal EHansen4K: how do you determine true equity? Money Whiz: Thank you! Bdpeep: WOW every one should do this no lie Money Whiz: But.... Holein1JL: apprasial value minus what you owe SEAMSEALER: Money Whiz....my question...please!!! Money Whiz: what happens if you think you're only going to be in the house Bdpeep: pay yourself and your family Money Whiz: for 5 years? Do you still do this? FOC723: to no closing cost 7.375 and intend to pay $200 monthly extra KJM0101: Now do the reverse... giving that 100$ to invested at higher return... do the comparison... K3101: thats a good one SirromDS: Yes - Because you'll save the most interest from the earliest years and you'll be building equity to put K3101: question that is SirromDS: towards your next house!$ Money Whiz: <SEAM: define "high yield investments". Sounds kind've risky to possibly lose the farm> Bdpeep: lol Whiz true!! Holein1JL: got to run, good job Whiz Bdpeep: tata Hol Money Whiz: <Thank you, Hol, hope to you see you soon> Money Whiz: David....KJM wants to know Bdpeep: David, you have great ideas here!! K3101: are there any secrets to the purchasing of a new home Money Whiz: if that $100, instead of going to apply Money Whiz: it toward principal, let's say, you invested it. Money Whiz: Can you *truly* do a comparison? EHansen4K: is that present apprasail or the apprasail at the time of purchase? Money Whiz: I know where you're coming from, re: reducing debt, but in the overall Money Whiz: scheme of things, what is your opinion? Money Whiz: <Although, KJM, the math dictates you're *guaranteed* reducing your debt> SirromDS: KJM - I can tell how much you'll save and the years you'll cut off your mortage, but I can't tell how much any Money Whiz: <but you're note *guaranteed* a higher return> Bdpeep: David give us the #s on your first home please SirromDS: investment will pay (unless it's a savings acct. or bonds) - which Bdpeep: I bet the savings short term far outweigh any profits in market SirromDS: would help you to sleep - no mortgage and no debt, or how the stock market Bdpeep: without scads of risk MarkATS139: David, is the trick to pay off the mortage asap? KJM0101: I have seen it be just the opposite bd... Bdpeep: yes Mark JMiller979: Sorry, got here late, any comments on refinancing 15 yr vs additional pmts on a 30yr MarkATS139: I agree SirromDS: will do? And remember, when you have no mortgae, you'll have more to invest, and if Bdpeep: Jm can you read up?? Bdpeep: dump baby dump SirromDS: the investment doesn't work out - you can't lose the house$ JCkats5634: does it pay to get rid of mortgage or does it really help your taxes? KJM0101: I am talking time value of money... Money Whiz: <Bd: no he can't, but I'm logging the session, I found out how, transcript available,cyber-Godwilling, manana. Bdpeep: moot point when excelerated Kjm Money Whiz: David you mention that you can have no mortgage, Money Whiz: no debt, Money Whiz: in as little as TWO YEARS? I'm with you up until this point. Bdpeep: thanks Whiz Money Whiz: Can you explain? That sounds too good to be true. K3101: yes it does my ears are wide open SirromDS: One of the big benefits of paying off your mortgage is that you have 100% equity - SirromDS: we paid off our first house in six years, bought a bigger house for $289 but only needed a $50K mortgage SirromDS: because of the 100% equity, and we paid off the 50K in 2 years the same way we paid off the K3101: so you hd 239k cash SirromDS: first house in six years (Saving every day)$ Bdpeep: David could you tell us how much you saved in interest??? Bdpeep: on first houde?? Money Whiz: So it wasn't necesssarily on the *first* house, in your Money Whiz: particular situation, but on the second, due to Money Whiz: the fact that you only had to take out a $50k mortgage, correct? FINKEN93: i have a question about student loans and debt FINKEN93: when you through thanks K3101: i dont know Money Whiz: <no prob FINKEN> Bdpeep: wrong forum Fin wait until after ok??! DSamuel408: We just bought our first home in August, how do we start? SirromDS: Correct, that was the benefit of managing money wisely from day one - building equity rapidly$ Money Whiz: Gotcha. NRCseattle: I have same question as DSam Money Whiz: We have a few firsttime homebuyers in here.. Money Whiz: who want to know how do you begin your ETP program, if you will? K3101: how much was the first mortage TOYOTATOO: doesn't that leave you with less money to enjoy life with? Bdpeep: gotcha covered Fin MCPCSY: Is it okay to have all of you equity in your house and only 6 months income in the bank? Money Whiz: <Rent videos. :-) > FINKEN93: my question is im currently in debt like many other recent college students Money Whiz: <TOYOTA> DSamuel408: What ETP? Sorry SirromDS: To have the money for extra to principal you need to focus on your goals and then Money Whiz: <DSamuel: ETP = extra to principal.> TOYOTATOO: thats great when it's raining Bdpeep: extra to principle JCkats5634: what percentage of the mort do you have to payout monthly to whittle down the debt quickly, say two years! Bdpeep: yes MC that is fine FINKEN93: i have college loans equaling 4919 SirromDS: reduce spending and expenses - use every dollar wisely, you can only spend a dollar once$ Bdpeep: Fin wait until 7pm please Money Whiz: <Fin, we'll be with ya shortly. I promise.> Bdpeep: we will help Money Whiz: David, JCkats would like to know.. FOC723: i have question which is better 15 or 30 yrs mortgage Money Whiz: what percentage of the mortage do you have Money Whiz: to pay out monthly to whittle down your debt quickly? Money Whiz: Do you go by percent or do you focus on Money Whiz: a fixed dollar amount? Does it matter? Bdpeep: 30 less stress, you can pay down just as easy on a 30 DSamuel408: Fixed dollar amount Bdpeep: but if something neg happens you have less monthly SirromDS: JCK- Not by percentage - I try for a fixed dollar amt, shooting for the most you can pay ETP$ MCPCSY: I just stopped prepaying my mortgage (13payment per year) cause my "dad" told me that if I was cash poor Bdpeep: whittle , dump whatever just do it gang pay yourself FOC723: with etp $200 is that a good strategy? MCPCSY: I should not prepay - what do you think? Money Whiz: Is ETP like "prepayment", then? MacBJ928: what about the theory of one extra note a year to knock out the principal Bdpeep: 6 months cushion is not cash poor MC Bdpeep: do more Mac if you can, every penny helps SirromDS: ETP is essentially prepayment; and there should be no prepayment penalties in your contract$ KJM0101: I agree MCP with your father... You need cash reserves for unforseen emergencies MacBJ928: thanks Money Whiz: Good point about the prepayment penalties. I know that Money Whiz: that can occur when buying/leasing a car. Not to sound MCPCSY: I have six - eight months already Money Whiz: like a broken record, but read the fine print. DSamuel408: If you pay one extra payment a year is it true you will lose 10 years? Also, if pay twice monthly instead. KJM0101: You don't know MCP's comfort zone for cash poor Bd... may be different than yours MCPCSY: Now I am trying to refinance so I can prepay even more? Money Whiz: Emergency fund = 6 to 9 months living expenses. GrnMtnMn5: what would pay more over 21 yrs, a 401k with 2.5% employer contrib., or ETP? Bdpeep: true KJM nor do you, I am thinking positive JCkats5634: is there a ratio of debt to payment to establish quick payoff? Money Whiz: David, is there a ratio of debt to payment to establish a Money Whiz: quick payoff, or, again, Money Whiz: is it just the fixed dollar amount? Money Whiz: How does one come up with a number? SirromDS: I emphasize 3 things before one dime goes ETP: pay off all credit cards, have liquid assets (emergency funds) SirromDS: and participate in your employers 401K plan to the extent that your contributions Bdpeep: tata gang the best to all of you SirromDS: are matched by your employer$ K3101: what about getting rid of the car note Money Whiz: <Night, Bdpeep, thanks for joining us!!!> MCPCSY: SDS - I agree! Money Whiz: We have time for one more question ... these hours are flying.. Money Whiz: helloooooo audience! FOC723: please on 15 or 30 years mortgage Jwkneel: what do you think of cofi loans Isherican: How do I shorten my time of paying off my mortgage? SirromDS: Liquid assets - difficult to get a number, a few thousand dollars should be sufficient, especially as you K3101: strtgie for buing a new house Money Whiz: <---------throwing a rubber dart at her computer screen... DSamuel408: Will 1 extra payment a year help any? SirromDS: build equity$ Money Whiz: and the winner is.... MCPCSY: Yes! EHansen4K: back to the issue of true equity, what apprasail? K3101: k3 Money Whiz: Lucky you, DSamuel... DSamuel408: How much can that reduce your total pay years? Money Whiz: David, does only ONE extra payment a year help K3101: stragie for buying a new house Money Whiz: at all? Money Whiz: Mathematically, no? yes? MacBJ928: make a contribution each note to principal isher TOYOTATOO: contact a property appraiser i your area,should cost about 300 Money Whiz: Of course, I'm sure, every little bit helps, but quantifiably? SirromDS: DSamual - anything/everything helps - the extra payment helps most if it's Early in the year; then every Money Whiz: <For additional resource to post your Money Whiz: <mortgage questions, go to > DSamuel408: A poor person really has no chasnce dors he? Money Whiz: <keyword: MoneyWhiz .... and then .. > GrnMtnMn5: it brings a 30 yr down to 21 yrs, on one extra a yer MCPCSY: Thank You!!!! Thank You!!!! Money Whiz: <go to "message boards" .... and find the home financing folders> SirromDS: payment for the rest of the year goes to pay more principal and less interest$ MacBJ928: just live within your means DSamuel408: Are you serious dm? TOYOTATOO: thanks mr whiz...nite all...zzzzzzzzz Money Whiz: You all were AWESOME! Money Whiz: TOYOTA: That's Miz Whiz. FTH42: is it better to pay off a 100000 mortgage or keep the money in a tax deferred ira? Money Whiz: David, great job!!!! DSamuel408: Thanks Mr whiz SirromDS: So long everybody!! Thanks for coming! User952615: thanks Money Whiz: <-----------getting a complex. I'm a girl! Money Whiz: Thanks, David. Round of applause? TOYOTATOO: ooooops, didn't have my contact in...sorry FINKEN93: are you ready for me? DSamuel408: Sorry Im glad to her that K3101: thank enjoyed Money Whiz: clap clap clap JCkats5634: right on sister friend! K3101: clapadedap MacBJ928: thanks TOYOTATOO: ENCORE!! K3101: heeeeeeeeeeeeee---haaaaaaaaaa TOYOTATOO: and lloking quite lovely tonight Money Whiz: 'Night David, sure hope you come back! Money Whiz: <TOYOTA, you charmer you.> MarkATS139: good stuff! Money Whiz: <OK Finken, what's your story?> SirromDS SirromDS SirromDS: It would be my pleasure - looking forward to a return visit - Thanks - Bye-bye$ PARTYMKT3: if you make the extra payment on a 15 yr mortgage how much do you cut it down FINKEN93: ok i just graduated from school last may MCPCSY: Yea Everyone Mr is MRS!!! Whiz!!! Money Whiz: <Thank you MCP> FINKEN93: i have a good job a professional fundraiser MCPCSY: No Problem! Money Whiz: <Remember: Keyword: MoneyWhiz ... find out more about "personal finance STUFF." FINKEN93: my problem is that i have 4919 in student loans small compared to most i know MCPCSY: Goodnite! FINKEN93: i have 3500 on a credit card that my parents used to help pay FINKEN93: for a vehicle that i shouldn't not of bought my junior year of college FINKEN93: now my parents have been short and i told them that i would take over the responsiblity to take over the burde FINKEN93: n FINKEN93: the rate is 15.9 FINKEN93: i had them lower it once to the existing rate DSamuel408: Heh, pay your bills like everyone else, You are a big boy now! FINKEN93: now i shopping around for an introductory rate of 4.9-5.9% so i can pay it off Money Whiz: I'm with you, FINK.... FINKEN93: i a very responsible person my parents are from the mentality of consume consume consume FINKEN93: i really educating my self with various books on investing from everything DSamuel408: Hey thats a hard habit to brek.