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Firefighter Bruno Gonzalez, his wife and three children are moving next week into a new, $1.1 million ``mini-mansion,'' as he calls it, in Pleasanton, California. The mortgage requires them to pay only interest for the first seven years. Payments on the $880,000 loan will be $3,300 a month, compared with $5,000 on a conventional 30-year fixed mortgage.
`Walk Away Millionaires'
Since they won't be paying any principal, they are betting on rising prices to increase their equity. The value of the family's previous home in Castro Valley, California, soared to $745,000 from $375,000 in just over five years.
``We know in the long run the house will appreciate so much that we're going to walk away without having to pay the principal down, really,'' Gonzalez said Wednesday in a telephone interview. While the home purchase is ``a stretch'' for the family's $155,000 annual income, Gonzalez said, ``we're going to walk away millionaires.''
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quote.bloomberg.com
I suppose it's easy to be optimistic when your jobs guaranteed and your retirement is worth a couple million. |
