[dewilson58]

Originally Posted by Packer Fan

Thanks for all of your input. I also did a search on this site, and here is what I have decided -
1. If you figure in the admin fee, the actual bond interest is 7.1%. Way more than the 4.18%.
2. With sinking my bonuses and the rental income into the house as well as the normal mortgage payment I am making, I will have the house paid off in 5 years, including the bond. I pay it now or when the mortgage is gone either way. No Debt!
3. Either way from a tax standpoint, you capitalize the bond on top of the home price and depreciate it over 27.5 years.
4. It is debatable weather the admin fee and interest are deductible, but they probably are. Either way, no reason to take a chance.
5. Just because the average person moves 3 times, does not mean Donna and I will. We looked at over 40 houses before choosing this one. We might buy another, but we will not sell this house. I know, some of you are laughing, but you are wrong. It does not hurt that every renter has told us that the location was a part of their decision to rent and we are walking distance to 2 pools. The house is also the right size.

That all being said, we sent in the bond payment today, along with another big mortgage buy down. It feels good - I am not sure there was a wrong decision for us. We made the right decision to begin with to buy our dream home in the Villages!

Good review of points. I think the total carrying cost of the Bond is extremely high, so I paid it off. Make sure you discuss with your tax person, the conversion of a rental property back to your primary residence........there are things to know in this situation.