It would also be better in case I lose my job as the minimum monthly payment would be lower than a 30 or 15 year loan making it easier for me to make ends meet.
Will the $200/month difference really matter that much?
No offense but I don't see a way to pay a $2k mortgage with no income. Either you get another job or you don't.
All the other benefits (inflation on loan etc) are the same for a 30 year. But you get way more equity, so you actually get something for the money you're putting in. If you're planning on investing the difference in monthly payments, you may get some value out of the 50 year scheme, but it doesn't sound like that's the plan.
Sound like you'd be better off to get a much cheaper house that you can easily pay off instead of a house you can barely afford with built-in expectation of losing your job and lower minum payments stretched out to 50 years and then forced to sell it anyway because you couldn't find the next job in time
I've been looking at houses with land that are under 200k, some under 150k, and they're not ratholes either. Essentially houses I can afford on my current salary, meaning that if I get the job I'm gunning for, I'll be able to easily afford the payments and still stock money away or invest it.
Let's say for the sake of the argument you could full pay the extra $200, and that allows you to have a 30 year mortgage. That's great, on paper you will beat the guy who has the 50 year mortgage.
However if you know of a better way to invest that 200 dollars, then after 30 years the person with the 50 year mortgage will have made a smarter financial decision because that 200 a month over 30 years ($72,000) could be turned into considerable profit if you pick the right investments or even just create a diversified portfolio of S&P 500 futures or even just metals like gold could have a significant yield for you
Yes. But the maturity window required is very long for that drip-fed investment to beat the ridiculous interest payments on a 50-year. A person who "needs" to go for a 50-year is living on the edge. Imo it's more likely that they'll have to get liquid due to life circumstances before his investment sufficiently matures, than it is for that investment to pay out.
This scenario also depends on a lot of "could." When the Japanese started throwing out 50+ year mortgages, it was the canary in the coalmine. Subsequently they crashed and their stock market took 30+ years to recover.
"Make a bet your investments will make up for 200% total interest after 30-50 years" is just not a great proposition.
Will the $200/month difference really matter that much?
If I'm trying to make every penny count when I have no income, absolutely.
No offense but I don't see a way to pay a $2k mortgage with no income. Either you get another job or you don't.
All the other benefits (inflation on loan etc) are the same for a 30 year. But you get way more equity, so you actually get something for the money you're putting in. If you're planning on investing the difference in monthly payments, you may get some value out of the 50 year scheme, but it doesn't sound like that's the plan.
Sound like you'd be better off to get a much cheaper house that you can easily pay off instead of a house you can barely afford with built-in expectation of losing your job and lower minum payments stretched out to 50 years and then forced to sell it anyway because you couldn't find the next job in time
I've been looking at houses with land that are under 200k, some under 150k, and they're not ratholes either. Essentially houses I can afford on my current salary, meaning that if I get the job I'm gunning for, I'll be able to easily afford the payments and still stock money away or invest it.
Let's say for the sake of the argument you could full pay the extra $200, and that allows you to have a 30 year mortgage. That's great, on paper you will beat the guy who has the 50 year mortgage.
However if you know of a better way to invest that 200 dollars, then after 30 years the person with the 50 year mortgage will have made a smarter financial decision because that 200 a month over 30 years ($72,000) could be turned into considerable profit if you pick the right investments or even just create a diversified portfolio of S&P 500 futures or even just metals like gold could have a significant yield for you
Yes. But the maturity window required is very long for that drip-fed investment to beat the ridiculous interest payments on a 50-year. A person who "needs" to go for a 50-year is living on the edge. Imo it's more likely that they'll have to get liquid due to life circumstances before his investment sufficiently matures, than it is for that investment to pay out.
This scenario also depends on a lot of "could." When the Japanese started throwing out 50+ year mortgages, it was the canary in the coalmine. Subsequently they crashed and their stock market took 30+ years to recover.
"Make a bet your investments will make up for 200% total interest after 30-50 years" is just not a great proposition.