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Author: ArmChairAnalyst CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 52  
Subject: Who is paying a mortgage? Date: 9/14/2006 9:59 AM
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Since we are the younger group around here, lets talk about mortgages. Who has one or doesn't have one? Have you paid it off or are you still paying? Would you rather rent than own?

I have a mortgage and my wife and I bought shortly after we were married. At the time we thought we were getting a really good deal with a FHA loan with almost nothing down.

Luckily we bought in 2001 before real estate prices started to sky rocket so we have a good deal of appreciation, but we had to agree to pay PMI, Private Mortgage Insurance, every month. Which came up to about $22.00 monthly.

Based upon the normal monthly payment the PMI was set to expire in 2011. We got a 25 year loan with a end date of 2026. We started off by paying about $50.00 extra per month. Recently we have decided that the PMI sucks and are going to make a lump sum payment of about $4,000.00 to knock it off completely.

We also did not refinance our mortgage when we should have so we are stuck with a little higher rate.

Also, we have juggling with the idea to invest more or pay more towards the mortgage. We have a fixed rate at 7% so it is borderline whether we could do much better in the stock market compared to paying down the home loan.

What are some of your experiences in this area?

Matt
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Author: hrse Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 32 of 52
Subject: Re: Who is paying a mortgage? Date: 9/14/2006 4:08 PM
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1. Have your proffesionlly house appraized. It should be worth considerably more than what you paid for it.

2. Visit at least two local credit unions and ask for a refinance quote. limit yourself to ones you qualify for this may be zero depending on whenere you live.

3. Visit a big box bank. Depending on where you live, this could be Bank of America, Wachovia, or others. Ask for a refinance quote.

4. Visit a local bank. Ask for a refinance quote.

5. Check out bankrate.com for a quote.

Do what is best for you.

The quote should contain info such as rate, closing costs (including points), how much you are saving per month, how long it will take for your savings to make up for the closing costs, Other fees such as PMI, which hopefully you will no longer be paying.

Try to avoid taking out extra cash, unless you need it to pay down unsecured debt or debt that has a higher rate (car for example)

Good Luck, and please report back,

HRSE


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Author: ArmChairAnalyst CAPS All Star Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 33 of 52
Subject: Re: Who is paying a mortgage? Date: 9/15/2006 12:52 PM
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Anyone else here? I guess this board is just about dead.

I thought with the age group we could have some good discussions about developing and implementing an investement strategy. Since most people in their 20s and 30s are either just starting to invest seriously or have already begun and are settling into a specific investment style.

Also, due to our age, we could be interested in more more speculative and risky investments.

This could be an excellent board if we could get some permanent contributors!

Matt


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Author: tenshuma Big red star, 1000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 34 of 52
Subject: Re: Who is paying a mortgage? Date: 9/17/2006 8:12 PM
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Haha. I don't know anything about getting a mortage - just turned 20 a while back.

Anyways, here's a little summary of my investing life thus far...

Started investing in 2005, with no newsletter/advisor whatsoever.

Savings are in the low five digits (in Canadian currency) with 33% of my total portfolio in RRSP/GICs. I happened to lock in better rates than are currently available and I will be released from my non-RRSP GIC in a year. I am in a self-directed RSP account, but will not be adding more funds until it becomes more worthwile...

Word of advice...just try and find a high interest rate savings account as opposed to getting a higher rate via a GIC. Unless you have a horrible propensity to spend, the advantages afforded through a GIC are virtually negligible - i.e. may not be able to redeem, slightly higher.

The rest of my portfolio is completely in equities/funds(which are equities).

Of "the rest of my portfolio", 10% CEF (closed-end fund) emerging markets. May add 5% index fund soon if I can find a good one.

Currently 10% cash position due to trailing stops (so far, they've saved me a lot of money).

I'm with BMO Investorline - even though the commissions are pretty outrageous. I figure I don't "trade" so I'll stick with it for now. Their website is down so I can't exactly figure out my portfolio allocation. I have all of my bank accounts with BMO, so I feel no hassle in transferring money between Investorline and my regular bank acccounts.

Don't pay any banking fees :) Student plan and all.

Anyways, portfolio allocation:

15% Emerging market fund
10% Cash
65% Small/Med-Cap Equities
10% Large-caps

As for my small/med-caps, I'm probably 1/3 in natural resource stocks, 1/3 energy, 1/3 random tech/other stocks that I come across.

Risky? Speculative? That's pretty much my portfolio. Oh, the wild highs and lows...

-Ten




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Author: dasBill One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 35 of 52
Subject: Re: Who is paying a mortgage? Date: 9/18/2006 1:38 PM
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Anyone else here? I guess this board is just about dead.

D'oh! I forgot to add this board to my favorites. It's added now, so I'll probably be contributing more often.

I don't have a mortgage. My work requires QUITE a bit of travel (in the last year, I've been in the States for a grand total of about six weeks, and actually at my house much less than that), and my home base is near Baltimore, which has been insanely expensive lately. It just doesn't make sense for me, personally, to buy a house as opposed to renting out a room in a basement. =) Actually, it might be cheaper to rent a storage room and just stay in a hotel when I'm back in town.

As for investing strategies, I've actually got a slightly different theory on investment risk. I've only been investing for about four years now, so I figure that as things go, I'm still pretty inexperienced. I figure that the time for riskier investments is once I have a cushion of "safer" equities and more importantly, I have experience in risking my money.

Most of my portfolio is BMW-type stocks (JNJ, MMM, GE, SYY) with a touch of Hidden Gems and Income Investor influence (NWY, MRH, LYG). I also have "speculative" investments in iRobot and Urban Outfitters, and some "value" investments in CQB, GLAD, and FAF. I figure I'm still working out my investment style, and justify that under "diversification." =)

I've been looking at real estate in the Pittsburgh region, if I can get a job there. I'll be sure to discuss mortgage issues then. I'm not sure yet if I'm tired of the travelin' life, though...

Bill

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Author: fndr489 Old School Fool CAPS All Star Global Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 40 of 52
Subject: Re: Who is paying a mortgage? Date: 9/26/2006 10:41 PM
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I am currently living with my sister and a friend at a duplex paying rent. I'd rather put the money towards a mortgage payment and build equity, but I am fresh out of school with some credit card debt that needs to be taken care of first. But I would definitely like to own my own house. I figure five years max before I get into one.

As for my investments, I have an old mutual fund that was started for me back in elementary school when all I cared about was recess time. I then got into another mutual fund my freshman year in high school. Alliance Premier Growth Fund A (now it's AllianceBernstein I believe). My grandfather's broker told him it was a good fund, and with an initial deposit of $250 I thought I shouldn't miss this opportunity. I think it might have broken even now... My junior year in high school, I managed to save enough money to start a Roth IRA with the Vanguard 500 Index. Let me tell you guys something...saving the $2k deposit earning minimum wage at a movie theater really sucked. I also trade individual stocks through Scottrade. I have DIS, MVL, NILE, SCSS, PRAA, and TASR (TASR being the pure speculation play. Guess I really like zapping the bad guys in Syphon Filter...) It's up about 15% so we'll see where it goes from here. I just bought some more SCSS today but would like to add to my PRAA position as I first purchased the shares before they dropped to the price range they are in.

I like to read most anything I can get my hands on and I am really intrigued with the idea that water might be the 'oil' of the future, what with growing populations and limited fresh water supplies...pure demand/supply economics at work. I also enjoyed Joel Greenblatt's little book about beating the market and what he proposes sounds really interesting. I might give it a try. I am also contemplating investing in currencies. I took an international finance class in college and did a practice account with an online broker. Made some good money at it too...

I agree with the statement that we can be a little more risky with our investments. We are at the age where we can take on more risk, bounce back and learn from any mistakes made.

Anyway, I ramble enough. It's bedtime.

Take care, fndr489

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Author: kaudrey Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 42 of 52
Subject: Re: Who is paying a mortgage? Date: 11/24/2006 9:21 AM
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Hi ArmChair,

I was just fishing around beyond my normal financial boards and took a look in here. I'm 37, so I'm at the old end for this board, I guess.

I have a mortgage. I bought my place in 1999 and refinanced in late 2000. Fixed rate at 5.875%.

I invest in a mix of mutual funds and stocks. The majority of my mutual funds are index funds but are well diversified with a healthy chunk of international and emerging market funds and ETFs. And a good minority of my funds are in managed funds. I tend to own larger company stocks - KO, PFE, PG, but I have some "play money" that I use to buy Hidden Gems or other small cap stocks I read about (after researching, of course).

I think for you younger folks, it's good to have a core portfolio of broad index funds, and then build on that with riskier investments. This will give you a certain level of comfort while still allowing you to reach for the "big gains".

Karen


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