- Nov 2013
It's impossible, apparently, to get that dialogue going with you.. your premise is always off when it comes to the math.Yes, you have 150,000 in cash, you buy a house for cash, you just made a real estate investment of 150,000
You yourself said that your house is worth $100,000 more than you purchased it for, so the lifetime return on your real estate investment was 67%
so only thing you did was put one risk free investment that has given you a collective 67% return. Turned it into a 2.75% liability, to put the money into another account.
How much do you pay on a mortgage over a lifetime of the mortgage.. (we are using 150,000 as the figure in our examples)
30 year you are paying 675/month to pay off the loan. you pay 243,000 in TOTAL to the mortgage company. that is a 87,000 you lose in that deal.
It doesn't matter how much I pay over 15 years, or 30 years.. to pay off the loan.
The interest I pay , in any given year is 2.75 %. it's already priced in into my example !!!
And the investment, that returns the 10% per year.. MINUS THE 2.75% of interest I pay on top of the loan amount... STILL RESULTS in an additional 7.25% profit that YOU DON'T have with your strategy.
And that's fine. You're more conservative, in your life, AND in your investment.OK. But please stop mixing it up all the time, and throwing the facts and math out of the window.
Math is NOT a liberal thing.