Quote:
Originally Posted by villagetinker
OK, 6 years ago this was a no brainer, interest rates (for mortgages) was at 3% (15 years fixed), rate of return on investments well over 5%, and there was still a way to deduct home mortgage interest. ALL of this has changed, we took the mortgage, and have come out ahead but I doubt that same scenario would work today, too many things have changed, we can no longer write of home mortgage interest, home mortgage rates are higher, and investment yields seem to be lower. As I stated in the chit chat lounger, talk to your financial advisor, there are lots of things to consider.
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Yep...
My wife was still working as an independent contractor when we moved here and running the numbers, it made a lot more sense to take a mortgage @3.4% out on about 1/3 of house value...and therefore allowing us the write-offs.
The invested money that would have otherwise went to pay cash for the whole house, has returned substantially more than 3.2% over the last 7 years (opportunity costs)...so it was a no-brainier for us back then.
Under the new tax laws,
and being in the longest bull market in US history, it may be time to 'noodle' things out again though...to see what makes more sense now.
In the long run though, I'm simply doing it for my kids as they'll be the ones benefiting...from my choices.