3 ms·
What's the point of a 15 year when the 10 year nominal rate - inflation rate is less than the gains you will make in income?
by justinzollars 6y ago
What's the point of a 15 year when the 10 year nominal rate - inflation rate is less than the gains you will make in income?
- 1stcity3rdcoast 6y agoOpportunity cost of the higher monthly payment surely factors in?
- mywittyname 6y agoYeah, I got a 15 year loan to save about 25% on my interest payments (3% vs 4%). Looking back, that was totally stupid because had I got a 30 year loan, and invested the difference (which I absolutely would have), I would earned a substantially greater return from the resulting stock boom.
- 1stcity3rdcoast 6y agoExactly and makes total sense. Plus, not everyone has infinite income, so people are "rate limited" into choosing the 30 over a 15 or 10.
- ahepp 6y agoIsn't that another advantage of 30 year?
- 1stcity3rdcoast 6y agoYes, especially if you have an alternative place to park the money that earns N+1, where N is your interest. Anything above that is marginal gravy.