Closing/Opening Credit Cards

[supton]

How is pmi for suckers? When I refi'd I had to get pmi--house lost so much value after the bubble burst that the bank required it. Yet after the refi my total payment was less, and I dropped pmi after a year or so. (refi'd from a thirty year, after having for 7, into a 15 year, will pay off in ten I think.) When I bought I put down 5%, no pmi. Made a few ballon payments but could not outrun the market.

Why rent when but for a bit more I can own?

*

Most "qualty" used cars are not much of a good deal. Cost per mile is the same as new. I tried to convince myself recently into a three year old Corolla, and quit when I decided that prices were out of line--I'd rather take new at 0% and enjoy a few years of no repairs. I'm not sure when the used car market will fix itself. Maybe in a few years, production is back to where it was. But right now used is insane, unless if you pay cash.

If you have cash, then by all means, a CPO might be better.

*

I think you have some good points; cash is king and all. But I've been content to chase after it all, and think I have managed just fine. If I was waiting for "security" I'd still be saving, and putting off kids until my 40's, and that would not sit well with me.

 

[cashmoney]

The great thing about internet forums is that folks get to post and read multiple options and perspectives on a topic. In fact a forum is better when people present significantly different perspectives and opinions. The readers can judge for themselves and take away what they want from various posts.

 

[JHZR2]

Originally Posted By: supton
How is pmi for suckers? When I refi'd I had to get pmi--house lost so much value after the bubble burst that the bank required it. Yet after the refi my total payment was less, and I dropped pmi after a year or so. (refi'd from a thirty year, after having for 7, into a 15 year, will pay off in ten I think.) When I bought I put down 5%, no pmi. Made a few ballon payments but could not outrun the market.

Why rent when but for a bit more I can own?

*

Most "qualty" used cars are not much of a good deal. Cost per mile is the same as new. I tried to convince myself recently into a three year old Corolla, and quit when I decided that prices were out of line--I'd rather take new at 0% and enjoy a few years of no repairs. I'm not sure when the used car market will fix itself. Maybe in a few years, production is back to where it was. But right now used is insane, unless if you pay cash.

If you have cash, then by all means, a CPO might be better.

*

I think you have some good points; cash is king and all. But I've been content to chase after it all, and think I have managed just fine. If I was waiting for "security" I'd still be saving, and putting off kids until my 40's, and that would not sit well with me.


PMI is a bad deal because youre not buying it to protect YOU. YOU are forced to buy it to protect the lender, and then if/when it pays, you may still be sued/owe tax/other things. Its a dance with the devil - youre stuck doing something that can cost you over a hundred dollars a month, just for them to be OK loaning to you.

Personally, Id rather they take the PMI premium and mandate the monthly payment to be that $100 or so higher per month. Yeah, its only, say, $1000/yr on a $200k home (may be off, my recollection is that PMI for most is around $50/100k borrowed/month), but that's an extra half percent of equity a year, and if the addendum in payment was mandated a bit higher, one could easily buy down an extra percent of equity a year, which is a good amount at the front end of a long mortgage..

For used cars, totally agree. Case-in-point, was car shopping with my inlaws this past weekend. Could get a new base highlander for $28k, a beautiful used one for $20600 with 40k. Given where they live, 100k miles on a solid vehicle is about all youll ever get. So if you amortize the new one over 100k miles vs the used one over 60k miles, the new one is cheaper per mile to own.

 

[supton]

Originally Posted By: cashmoney



The great thing about internet forums is that folks get to post and read multiple options and perspectives on a topic. In fact a forum is better when people present significantly different perspectives and opinions. The readers can judge for themselves and take away what they want from various posts.


This I very much agree with. The more I surf, the more I get exposed. 'tis a wonderful place to be, much exposure. Well, at least on some boards, others do seem a bit more closed.

 

[Lolvoguy]

Originally Posted By: supton
Originally Posted By: cashmoney



The great thing about internet forums is that folks get to post and read multiple options and perspectives on a topic. In fact a forum is better when people present significantly different perspectives and opinions. The readers can judge for themselves and take away what they want from various posts.


This I very much agree with. The more I surf, the more I get exposed. 'tis a wonderful place to be, much exposure. Well, at least on some boards, others do seem a bit more closed.


+2

 

[doitmyself]

Originally Posted By: cashmoney



The great thing about internet forums is that folks get to post and read multiple options and perspectives on a topic. In fact a forum is better when people present significantly different perspectives and opinions. The readers can judge for themselves and take away what they want from various posts.


I'm glad that you recognize this, as your posts come across as slightly self righteous: how you live is how everyone should live. Just an observation.

I am cut from a very different cloth compared to most and have taken "the road less travelled" in life. I have NO interest in accumulating wealth and material things. I have other values that are much more important to ME. So, that's how I live and enjoy life. I am both humble and grateful that my life is so rich.

Simple home. Simple car. Basic needs. I simply have no desire to get "better" things. I am excited to have a canoe while others lust for a bass boat or bigger. I follow the simple, common sense ideas that you list above. Don't spend more than you take in. Do without when needed. Save first, spend the leftover - not vice versa. I have an excellent retirement investment growing. What I don't do is spend a lot of my time dwelling on making every penny that I can. I enjoy my extended family, my friends, being outdoors, doing things with and for others that has meaning.

I see way too many young people chase the almighty dollar early on, only to fail miserably as they enter middle life. There needs to be priority and balance.

To each their own. If I/we die with no money to pass forward, that is fine with me (with money for my wife to exist, of course).

 

[cashmoney]

Originally Posted By: doitmyself
Originally Posted By: cashmoney



The great thing about internet forums is that folks get to post and read multiple options and perspectives on a topic. In fact a forum is better when people present significantly different perspectives and opinions. The readers can judge for themselves and take away what they want from various posts.


I'm glad that you recognize this, as your posts come across as slightly self righteous: how you live is how everyone should live. Just an observation.

I am cut from a very different cloth compared to most and have taken "the road less travelled" in life. I have NO interest in accumulating wealth and material things. I have other values that are much more important to ME. So, that's how I live and enjoy life. I am both humble and grateful that my life is so rich.

Simple home. Simple car. Basic needs. I simply have no desire to get "better" things. I am excited to have a canoe while others lust for a bass boat or bigger. I follow the simple, common sense ideas that you list above. Don't spend more than you take in. Do without when needed. Save first, spend the leftover - not vice versa. I have an excellent retirement investment growing. What I don't do is spend a lot of my time dwelling on making every penny that I can. I enjoy my extended family, my friends, being outdoors, doing things with and for others that has meaning.

I see way too many young people chase the almighty dollar early on, only to fail miserably as they enter middle life. There needs to be priority and balance.

To each their own. If I/we die with no money to pass forward, that is fine with me (with money for my wife to exist, of course).




My posts are aimed at persuading people to avoid life long debt and work towards having some measure of financial security. To some my message will resonate with its basic truth and to others it will bounce right off as facetious, self-righteous, etc...par for the course.

I don't care about anyone being "wealthy" (which must always be a relative measure). I want people to strive for financial security - I define that as having no consumer debt, owning your own home/property free and clear, and having a minimum of 6 months living expenses in the bank. How big or fancy the home and car(s) is not a concern and not relevant, everyone has a different definition of what a comfortable living standard should be. If they are happy with a very modest home, modest assets, older low cost but reliable cars - more power to them.

 

[wallyuwl]

Originally Posted By: supton
Yet after the refi my total payment was less, and I dropped pmi after a year or so. (refi'd from a thirty year, after having for 7, into a 15 year, will pay off in ten I think.) When I bought I put down 5%, no pmi. Made a few ballon payments but could not outrun the market.

Why rent when but for a bit more I can own?

I think you have some good points; cash is king and all. But I've been content to chase after it all, and think I have managed just fine. If I was waiting for "security" I'd still be saving, and putting off kids until my 40's, and that would not sit well with me.


We probably bought before we were "ready" as well, in 2008 just after the lending standards went up after the crash in fall 2007. We bought a HUD foreclosure that didn't have carpet or window coverings and the walls had crayon all over them. Put about $5k into it and could sell it now in a week for $15k more than we paid. In the mean time, our mortgage was about what it would have cost to rent, until we refinanced not quite two years ago. Now it costs us about $200 less per month than it would to rent the same floor plan house in our neighborhood (and went from a 30 to a 20 year mortgage), and that accounts for taxes and insurance. Yeah, we are paying interest, but it is stupid to rent when you can get a mortgage and your money is going toward building equity and your payment is less than it would be renting. This goes back to money and credit being a tool.

 

[doitmyself]

Originally Posted By: cashmoney
My posts are aimed at persuading people to avoid life long debt and work towards having some measure of financial security. To some my message will resonate with its basic truth and to others it will bounce right off as facetious, self-righteous, etc...par for the course.

I don't care about anyone being "wealthy" (which must always be a relative measure). I want people to strive for financial security - I define that as having no consumer debt, owning your own home/property free and clear, and having a minimum of 6 months living expenses in the bank. How big or fancy the home and car(s) is not a concern and not relevant, everyone has a different definition of what a comfortable living standard should be. If they are happy with a very modest home, modest assets, older low cost but reliable cars - more power to them.


Thank you for the clarification and intelligent answer.

My dad was a post WWII European immigrant that worked hard (and smart) to achieve a very successful blue collar American dream. Therefore, I had a savings account before entering kindergarten and was fortunate to have parents that instilled your good ideas from the start. I take this stuff for granted....now there are people making a bundle teaching this common sense.

Back on topic. I hope the OP has learned what to do! I've only maintained a minimum of credit cards and use them prudently.

 

[SteveSRT8]

Originally Posted By: cashmoney

I want people to strive for financial security - I define that as having no consumer debt, owning your own home/property free and clear, and having a minimum of 6 months living expenses in the bank.


A beautiful ideal, and hardly even considered by most younger folks I meet these days. My grown kids will tell stories of me railing about how credit only allows you to artificially inflate your lifestyle. Rarely is it used responsibly...

 

[Lolvoguy]

Originally Posted By: wallyuwl

We probably bought before we were "ready" as well, in 2008 just after the lending standards went up after the crash in fall 2007. We bought a HUD foreclosure that didn't have carpet or window coverings and the walls had crayon all over them. Put about $5k into it and could sell it now in a week for $15k more than we paid.

wow, dont' spend it all in one place!

sorry, I just had to

 

[wallyuwl]

Originally Posted By: Lolvoguy

wow, dont' spend it all in one place!

sorry, I just had to


It isn't an expensive house and the market where I live is fairly subdued. We have a decent amount of equity in it as well.