UnThreaded | Threaded | Whole Thread (13) | Ignore Thread Prev | Next
Author: SwaniRiver Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 308565  
Subject: Re: Buy a house or pay off cards Date: 4/22/1998 5:34 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
I've been on both sides of the equation (buying and selling a house) serveral times, and let me tell you one thing: Your house will not outpace 18% debt, ever, and if you're planning to sell it in 4 years, you don't stand to make any money at all.

Please believe me, I came of age in the '80s, when the Donald was King and the S&L's hadn't failed yet, and it was beaten into me time and time again: Buy a house, it's a great investment, get into real estate. So I have several times, and let me sum up my findings:
1. You won't turn 15% a year, not now and not over any long haul.
2. Selling a house is harder than you think. You have to cover the agents 6% (sometimes 7%), and will probably be forced to make some concessions on price
3. To make any use of the itemized deductions for interest, your house's value must be above a minumim value, otherwise the standard deduction will still be greater than your conbined interest payment - buy a house greater than 140K or so.
4. With your income and debt situation, you may no be able to qualify for a quality house that will appreciate.
5. At closing as a buyer, there are going to pluck you like a turkey with fees and percentages. It's amazing.

My suggestion is get debt free above all. You will be 'making' a garunteed 18% on any money you use to pay off your debt, which is a fabulous investment. Wait on the house, or you;ll come to rue it.
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (13) | Ignore Thread Prev | Next

Announcements

TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
Managing Your Wealth
Our own TMFHockeypop from Rule Your Retirement fame on the TV show Managing Your Wealth.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Post of the Day:
Apple

Apple and Ninety Years Ago
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement