Quote:
Originally Posted by Arctic Fox
I guess we're just viewing it from opposite directions.
You ask why spend $25k to pay off a 6% loan when you could invest that money in the stock market at 8%.
I ask why you would keep paying 6% when you could borrow against the house at 4%.
So how about this for the best of both worlds: borrow $35k against the house - monthly repayment over 30 years would be slightly less than currently paid on the 6% bond - use $25k to pay off the bond, leaving you $10k "free" cash to invest in the stock market.
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Until you need to sell your house. With the bond intact it is then assigned to the new owner. Take out a loan and you eat the whole bond.