Posted on: 31st Mar, 2010 12:36 am
Hello, Have a question thats been killing me. Just bought my house. Loan was for 114,000. 30 year, fixed 5.125%, monthly payments are 802. Im 6 months in and have been and plan to continue payments of 900 a month. I believe the actual mortgage is 630 a month minus the taxes, insurance etc.. But the question is should I use my 8000 tax credit and put it directly to the mortgage at one time? Would this significantly reduce my years considering my low interest rate? Or would It be better to invest that money? I would ideally like to pay off my house in 15 or less years. Thanks in advance for your help, this situation has my head spinning.
if you have a $114,000 mortgage at 5.125% for 30 years, the required monthly principal and interest payment is $620.72.
you presently pay $900 a month. i have no idea if that means you are paying $279.28 extra every month toward principal and interest, or, you pay $900 a month and that is some amount over what the total payment is including taxes and insurance. in other words, how much extra pricipal are you paying every month above and beyond the rerquired monthly payment of $620.72. if you tell me the amount of the extra pricnipal every month, i can compute what that does as well as paying a one time lump sum of $8,000 does.
before you tell us the extra principal you pay every month when you pay $900 a month, i will say it is a very bad idea to pay a lump sum of $8,000 to the bank and it is also a bad idea to pay extra principal monthly unless you have about 12 months living expenses in an account in case of emergency. once you give the bank the money, they have it you do not. if you have an emergency, you have to refinace to get the money and if the emergency is a lost job you can not refinance to get the money.
you presently pay $900 a month. i have no idea if that means you are paying $279.28 extra every month toward principal and interest, or, you pay $900 a month and that is some amount over what the total payment is including taxes and insurance. in other words, how much extra pricipal are you paying every month above and beyond the rerquired monthly payment of $620.72. if you tell me the amount of the extra pricnipal every month, i can compute what that does as well as paying a one time lump sum of $8,000 does.
before you tell us the extra principal you pay every month when you pay $900 a month, i will say it is a very bad idea to pay a lump sum of $8,000 to the bank and it is also a bad idea to pay extra principal monthly unless you have about 12 months living expenses in an account in case of emergency. once you give the bank the money, they have it you do not. if you have an emergency, you have to refinace to get the money and if the emergency is a lost job you can not refinance to get the money.
The monthly payments are 802, So i am paying 98 dollars extra a month towards principal. I have a good amount of money in savings like you say to have. Thanks
1. If you just pay $98 extra monthly the loan will pay off in 307 months or 25.58 years
2. If you pay down $8,000 and continue to pay $98 extra each month the loan will pay off in 266 months or 22.16 years.
3. If you want to pay off in 15 years pay $909 every month in principal and interest or $289 extra every month.
4. If you pay down a lump sum of $8,000 and want to pay off in 15 years, pay, pay $845 every month in principal and interetst $225 extra every month.
OVer time the taxes and insurance will go up, so, you will have to pay more than $900 a month to be paying $98 extra or whatever extra you choose to do.
2. If you pay down $8,000 and continue to pay $98 extra each month the loan will pay off in 266 months or 22.16 years.
3. If you want to pay off in 15 years pay $909 every month in principal and interest or $289 extra every month.
4. If you pay down a lump sum of $8,000 and want to pay off in 15 years, pay, pay $845 every month in principal and interetst $225 extra every month.
OVer time the taxes and insurance will go up, so, you will have to pay more than $900 a month to be paying $98 extra or whatever extra you choose to do.