40 Year Mortgages

[CBadDad]

Whats the latest on the 40 year mortgage?
What are the rates/points compared to a 30 year note?
For those in the biz, how popular are they?
Does anybody have one?
What are the pro's & cons?

[essexjet]

Whats the latest on the 40 year mortgage?
What are the rates/points compared to a 30 year note?
For those in the biz, how popular are they?
Does anybody have one?
What are the pro's & cons?
a 40/40 are out there but it comes with a hit on the rate and over the long term it is not worth it:
400,000 30year 6%=$2398
400,000 40year 6.125%=$2236
over the life of the loan it would be an additional $210,000 on the 40 year

[djunkie]

Whats the latest on the 40 year mortgage?
What are the rates/points compared to a 30 year note?
For those in the biz, how popular are they?
Does anybody have one?
What are the pro's & cons?
Con-Its takes 40 years to pay off your house. :cry:
Actually I was wondering the same. From what I heard is, it really doesn't lower the monthly that much. But I'm probably wrong as usual.

[Do F150's Float?]

Good for subprime clients who don't qualify for an interest only loan (but that's not a 40/40, its a 2/38 or 3/37) because it keeps the payment lower than say a 2 or 3 year fixed.
Not so great for A paper people - like it was said, the payment isn't a whole lot lower, and you end up paying way more interest back. :rollside:

[imbndvs]

Why would anyone even consider a 40 year loan? I do all mine at 15 year. Its only a differance of a couple hundred dollars, you get a better interest rate and you build equity much faster. 40 year is just plain dumb.

[djunkie]

Why would anyone even consider a 40 year loan? I do all mine at 15 year. Its only a differance of a couple hundred dollars, you get a better interest rate and you build equity much faster. 40 year is just plain dumb.
So how much of a difference in monthly payments would it be for a $400,000 loan?

[Ziggy]

I might not live another 40 years :crossx:

[reDECKulous]

Don't forget about the 50 yr loan... pymt is similar to the 30 yr i/o but you are paying down the mtg

[acatitude]

so lets see a show of yeas to who has lived in the same house for 20-30-40 years???? maybe its an age thing but i dont much care about building equity by bigger payments.... 15 years in this house and thats been the longest, and its currently on the market

[eman1625]

The majority of people dont stay in their homes long enough to pay them off. If your not getting close to retiring or it's your first or second home, chances are your gonna sell and move again down the road. 40yr/50yr or the I.O. is not a bad deal if you know your gonna be out in 5-7 years. Most of the 15yr and 20yr loans are for the ones that are looking towards retiring and know they are gonna stay put for the long haul.

[djunkie]

so lets see a show of yeas to who has lived in the same house for 20-30-40 years???? maybe its an age thing but i dont much care about building equity by bigger payments.... 15 years in this house and thats been the longest, and its currently on the market
I've been in the same house for almost 30 years. I still live with my parents cause I can't afford to buy a house. :cry: :cry:

[Parker Dreamin]

Why would anyone even consider a 40 year loan? I do all mine at 15 year. Its only a differance of a couple hundred dollars, you get a better interest rate and you build equity much faster. 40 year is just plain dumb.
You know what they say about opinions......

[djunkie]

You know what they say about opinions......
:crossx: :crossx: :crossx:

[TOBTEK]

I've been in the same house for almost 30 years. I still live with my parents cause I can't afford to buy a house. :cry: :cry:
stop putting buckets of money into V-twin golfcarts, and maybe you could move out :rollside:
I know..... people in glass houses, blagh,blagh,blagh

[TOBTEK]

also keep in mind how offten most people refi their homes. Does anyone keep their mortgage for 30 or 40 years? Most not! use the financial "tools" available to make the most $$$$ you can.

[Wake Havasu]

stop putting buckets of money into V-twin golfcarts, and maybe you could move out :rollside:
I know..... people in glass houses, blagh,blagh,blagh
Or DCB's!
:)

[djunkie]

stop putting buckets of money into V-twin golfcarts, and maybe you could move out :rollside:
I know..... people in glass houses, blagh,blagh,blagh
RRRRRRRR. Like the money I have into that thing would make any difference on a $600k + home. :rolleyes: :rollside: :rollside:

[acatitude]

the other advantage to some of these type loans is you can use other properties to buy more with no out of pocket expense and as you move to new house and rent old one you have not increased your mtg outgo per month,,,,, as long as they are rented...

[Nubbs]

I've been in the same house for almost 30 years. I still live with my parents cause I can't afford to buy a house. :cry: :cry:
Gee, now I don't feel like such a looser. :D

[djunkie]

Gee, now I don't feel like such a looser. :D
You still live with mommy and daddy too? :crossx: :crossx:

[truksnboats]

The main goal in most homeowners eyes is the lowest payment. Like mentioned above, most subprime borrowers are taking this as a second option because they don't qualify for an interst only product (560 is the lowest fico for I.O). I see a trend of people getting out of the neg am loan and into 40 yr loans. Most 40 yr loans are amortized for 40 but do in 30 (balloon).

[YeLLowBoaT]

So how much of a difference in monthly payments would it be for a $400,000 loan?
400k at 6.5 is around 2600 for 30 years and about 3500 for 15 years. 40 years would put you about 2400.

[Nubbs]

You still live with mommy and daddy too? :crossx: :crossx:
SSSHHHHH! Don't be spreadin that around. :D

[rodnjen]

Those loans (IO, 40yr, etc.) seem to only make sense if you are leveraging to buy other properties. Evenutally you are going to want to stop making payments when you retire. Most people do not have enough money in 401k's or pensions to continue paying a mortgage and living a comfortable lifestyle.
Debt management is often put aside so people can keep up with the 'Jones'). Managing your debt properly can help protect your family's wellfare from outside influences such a drastic change in the equity or real estate markets. That being said, everyone is different and needs to do their own research to decide what best suits their family's goals.

[SHOTKALLIN]

RRRRRRRR. Like the money I have into that thing would make any difference on a $600k + home. :rolleyes: :rollside: :rollside:
Maybe you should not have such high exspectations for your first house? 600k+??? I hope you like living with Mommy and Daddy. You might be there a while.

[catman-do]

The 40 year amort loans usually have a 10-20 bps add on where the 50 is usually .125 - 25 bps add to any of the standard rates offered by the lender. I work for BNC which is a subprime lender and out of about 40 loans per month that I fund... I would say about 10 will be on a 40 year program, 3-5 might go 50 year, and 15-20 will be IO. Very few subprime borrowers will stick to a 30 year amort loan without any options to lower their payment. The avg person in so cal is staying in a house 5.5 years, and from what im seeing it seems like everyone refi's about every 8mo. In 3 years that I have been on the subprime side, I have yet to see someone shorten their terms ie: 15-20 year fixed. I personally am on a 3/27 IO and a 30/15 2nd.

[djunkie]

Maybe you should not have such high exspectations for your first house? 600k+??? I hope you like living with Mommy and Daddy. You might be there a while.
$600k is the average around where I live. They're coming down a little but not much. And no I'm not gonna move to Corona.

[Jyruiz]

$600k is the average around where I live. They're coming down a little but not much. And no I'm not gonna move to Corona.
We were thinking of buying out there before we purchased our Havi house, but once we drove during rush hour traffic, all bets were off. Cool though if you work graveyard or something like that.

[SoCalSouthpaw]

I still live with my parents :cry: :cry:
So do you take down your dates parked in the front of your parents house? Or down at the local Sleazy8? :idea:

[djunkie]

So do you take down your dates parked in the front of your parents house? Or down at the local Sleazy8? :idea:
I have the whole front part of the house to myself. My parents room is upstairs and in the back. If they only knew what has gone on. But I usually just go to my g/f's place. :rollside: :rollside:

[djunkie]

We were thinking of buying out there before we purchased our Havi house, but once we drove during rush hour traffic, all bets were off. Cool though if you work graveyard or something like that.
Well I work nights so it would be possible for me. But with the type of job I have I get longs breaks during my shift so its kinda nice to drive 5 minutes and be home instead of hanging around the parking lot of the job. :yuk:

[Jyruiz]

Well I work nights so it would be possible for me. But with the type of job I have I get longs breaks during my shift so its kinda nice to drive 5 minutes and be home instead of hanging around the parking lot of the job. :yuk:
I hear ya bro, I work 5 miles away from home and the wife 2 miles away from home. Makes it real convenient for nooners. :D

[djunkie]

I hear ya bro, I work 5 miles away from home and the wife 2 miles away from home. Makes it real convenient for nooners. :D
I did think seriously about it though. But the fact is, my family is here, my job is here, my friends are here, and driving that freakin 91 freeway everyday would kill me. I figure, if I can afford to pay a bigger mortgage to have the convenience, than its worth it to me.

[Jyruiz]

I did think seriously about it though. But the fact is, my family is here, my job is here, [B]my friends are here[B/], and driving that freakin 91 freeway everyday would kill me. I figure, if I can afford to pay a bigger mortgage to have the convenience, than its worth it to me.
Didn't know you had any friends. :D

[djunkie]

Didn't know you had any friends. :D
Shhhh. Don't tell anyone. Actually its just some old high school buds that I was in the math club with. :rolleyes: :rollside: :rollside:

[SHOTKALLIN]

$600k is the average around where I live. They're coming down a little but not much. And no I'm not gonna move to Corona.
I commuted from moval to lynwood for 8 years. 150 miles a day. commuting is no joke. I was lucky enough to have the option of working 6-2, 2-10, or 10-6. still a commute is no joke after a double shift or 2. its not for every body.
in todays market though i think i would buy a home elsewhere or some land that I knew was gonna gain equity. later i would sell or use the equity to buy a home where i wanted. it makes a whole lot more sense than a savings account. at least its working for me.

[al cole'holic]

Why would anyone even consider a 40 year loan? I do all mine at 15 year. Its only a differance of a couple hundred dollars, you get a better interest rate and you build equity much faster. 40 year is just plain dumb.
...you should consider writing a book explaining how we all should be living :boxed:

[Wet Dream]

I never take mine over 15 years, and its bi-weekly which reduces it down to under 13 years.

[Wmc]

Pros - Lower payment, able to purchse a home, when normally you may not have been.
Cons - Not alot going to principal, not paying your home off in a timely manner. Balloon payment after 30 years, it is a 40/30.
Most people don't live in their home long enough to ever see the Deed in your hand. And if you do plan on paying your house off you go into a 15 year mortgage when the rates are in the high 4's or low 5's and when retirement comes you are mortgage free.
Payment on a $400,000 loan
40 yr - $2399
30 yr - $2579
30 yr I/O - $2250
Wendi Cook
Provident Bank Mortgage

[CBadDad]

Pros - Lower payment, able to purchse a home, when normally you may not have been.
Cons - Not alot going to principal, not paying your home off in a timely manner. Balloon payment after 30 years, it is a 40/30.
Most people don't live in their home long enough to ever see the Deed in your hand. And if you do plan on paying your house off you go into a 15 year mortgage when the rates are in the high 4's or low 5's and when retirement comes you are mortgage free.
Payment on a $400,000 loan
40 yr - $2399
30 yr - $2579
30 yr I/O - $2250
Wendi Cook
Provident Bank Mortgage
I'm surprised you didn't show the numbers for a 15 yr mortgage too.
I also think I need a glossary to understand some of your lender lingo (Not just you Wendi). Can someone define the following?
-Subprime
-BPS
-Amort (I assume that was short for ammortization, but exactly what is that?)

[CBadDad]

Also, how did we get stuck on $400K?
Can we assume that these numbers are doubled for $800K?

[CBadDad]

Most 40 yr loans are amortized for 40 but do in 30 (balloon).
Does this mean that it really is a 30 yr loan with a fat payment due after 30 yrs. Kinda like leasing a car???