2 ms·
FUD. The number is less than 2x, not 3-4x. Loan amount: $500,000 Interest rate: 4.5% Total paid: $912,033.56 http://www.bankrate.com/calculators/managing-de
by Domenic_S 12y ago
FUD. The number is less than 2x, not 3-4x.
Loan amount: $500,000
Interest rate: 4.5%
Total paid: $912,033.56
http://www.bankrate.com/calculators/managing-debt/annual-percentage-rate-calculator.aspx http://www.bankrate.com/calculators/managing-debt/annual-per...
You're forgetting two other things:
1.) A portion of interest paid is tax-deductible (rent is not).
2.) $1 today is not worth $1 30 years from now - your payment stays constant for 30 years, but your dollars gain more buying power.
- jacquesm 12y agoYou're missing the point that you are also paying the principal. He didn't say 'extra' just paying 3 to 4 times. And that 4.5% can be improved upon but only if you go variable rate, if you lock it down for longer it can get quite a bit higher (or if you are considered a higher risk client, such as someone who is self employed).
- xrange 12y ago>You're missing the point that you are also paying the principal. Just so everyone is on the same page. The original 30 year, $500k loan that Domenic_S is proposing, at 4.5% interest has a monthly payment of $2533.43. After 360 of those payments (30 years * 12 months per year), all the principal and interest will have been paid off. 360 * $2533.43 = $912034 $912034 / $500000 = 1.82