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If someone is smart, they make a small mortgage on a small house and pay it off in 10-15 years minimizing their interest overhead. Knowing you don't have to co
by hajile 7y ago
If someone is smart, they make a small mortgage on a small house and pay it off in 10-15 years minimizing their interest overhead.
Knowing you don't have to come up with hundreds or thousands of dollars every month in order to live is an amazing feeling. You can then set aside that same money every month and upgrade to a better house. Unfortunately, most people decide they can't wait and take out 30-year mortgages that wind up costing them almost twice the value of the house.
With proper maintenance, a house can last with continuous use for a hundred years. With average use, you would be hard-pressed to have a car for more than 15 years before the cost to maintain greatly outstrips the cost to replace.
- cookingrobot 7y agoBuying small is the wrong financial decision in a rising real estate market. By taking a giant mortgage and buying more that you could otherwise afford you’re essentially investing on margin. And interest rates are even lower than they seem if you take tax deductions into account. If you buy at the right time & place and property value increase a lot (which has been true in a lot of places the last decade), you get the gains. And as a bonus you get to live in a nicer house that whole time (unlike investing that money elsewhere).