can you link me to that NAR report? sounds like interesting reading
i don't think it makes sense for most people to own their home free and clear...when you consider that you can earn 8 to 10% a year on your money in a well run balanced mutual fund, which grows tax free until you sell it, and in the meantime, you are only paying 5 or 6% at most on a fixed rate mortgage, which is effectively 3.5 to 4.2% after taxes for most people, the resultant 5% or so net gain per year on your money is very attractive over the long term
owning your home free and clear doesn't mitigate the effects of an increase or decrease in its value, though perhaps it does help psychologically
on average, people move about every 5 years anymore, so while i don't agree with their being leveraged to anywhere near 100% of a house's value (even though much of such risk is offset by PMI), i don't see anything wrong with a LTV of 80%...i keep seeing all these concerns about LTV at levels much higher than that, but in studying the reports of companies like NEW, NFI, etc., i don't see them writing paper at these terms...who is writing this paper in any quantity? just curious |
