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Dave
Ninja Editor
 
Join Date: May 2004
Location: Bay Area, CA
 
2007-03-15, 03:20

Quote:
Originally Posted by Kickaha View Post
It's funny, my family does commercial real estate, and their advice has always been "get the *longest* mortgage you can". See, you'll pay more in interest... if you stay in the property until it's paid off. But if you have a 50, 75 or 100 year mortgage, chances are you're not going to be. (Frankly, most people don't stay in a house for even 20 these days, so it's not that different.)

Your monthly mortgage can be considerably reduced. Now, if you take that difference and invest it wisely, you will end up by the time you sell, *ahead* of the game. Your investment profits will more than offset your additional interest you paid. End result - you make more money.

Totally backasswards from what most folks do, and emotionally, it makes makes me twitch, but numerically, it makes sense. Just a thought.

You do, however, have to be absolutely disciplined in investing the difference, and if you blow it in your investment strategy, you're hosed, but even a conservative low-risk investment will overtake a low interest rate available these days.
That's damn clever!
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