A new mortgage in your 50s? If yes, how long?

[yoopermom]

I'm 47, DH is 51. We are looking at buying a home possibly. (If it matters, we have a 20% downpayment for this purchase from the sale of our last home, and our current home is paid off, although worth very little.)

I feel very, very strongly that I don't want to go beyond a 15 year mortgage, because I don't want to have a mortgage during retirement. DH does not agree.

Have you/would you want to have a "new" mortgage in your 50s, and, if yes, for how long of a time period?

TIA!

Terri

 

[HM]

Well, we refinanced our home to a new lower 30 year at age 50. We don't intend to stay in this house forever though. In about five years we'll be buying again (late 50s), a smaller home. We'll still have to mortgage so I imagine it will be a 15 year if the numbers work.

 

[ceemys]

I'm 47 and just bought a house. My fiance is 51 and moved in and our plan is to doulbe up on the payments after we pay off his car in 2 years. In the mean time, I will probably make 2 or 3 extra payments a year. We plan on having it paid off in less than 15 years. If you can do it, go for it!

Than we said we will become snowbirds and head to FL when it gets too cold in IN. lol

 

[DawnM]

We have stuck within the Dave Ramsey guidelines, no more than 25% of your take home pay on a 15 year mortgage and at least 20% down.

We are considering moving but I am worried we will just start a 15 year all over again and so that may not be the best idea. We are near your ages AND we have kids heading to college in the next few years.

We have friends who are 48 and 52 and they have just taken on a new 30 year mortgage.

Dawn

 

[yoopermom]

Thanks everyone, for your quick replies. I know part of our "problem" is that I come from a family of teachers, who were all frugal, retired before 60, and enjoyed their healthy years of life after. DH comes from a family that works until their 70s, and never had much of anything, so he doesn't worry so much about it.

And, Dawn, I've always felt that your storyline has paralleled mine in many ways. Our DS is going to be a sophomore in college, but, luckily, we do not pay much towards that expense. It would actually *help* our FAFSA to have our $$ in a house, rather than sitting in savings in the bank (stupid, I think, but...). DS says, "FAFSA thinks we're rich, don't they KNOW we're not ?"

This was all much easier to decide when we were in our twenties and thirties...

 

[Sadie22]

30 years. You can always pay it off faster, but you cannot make lower payments on a 15-year mortgage if you run into any problems with cash flow in the future.

 

[RitaE]

I'd personally probably go with a 10 or a 15 year because whenever I browse through rates anymore it seems like the 15 year fixed rates sit a full percent below the 30 year fixed rates.

But rates are so bottom basement low anymore that I really don't feel an urgency to get everything paid off asap these days. If you could find an excellent 30 year rate, then it might be something to consider. Especially if you have other urgent needs for large chunks of money these days, like college tuition bills.

 

[tvguy]

I'm 47, DH is 51. We are looking at buying a home possibly. (If it matters, we have a 20% downpayment for this purchase from the sale of our last home, and our current home is paid off, although worth very little.)

I feel very, very strongly that I don't want to go beyond a 15 year mortgage, because I don't want to have a mortgage during retirement. DH does not agree.

Have you/would you want to have a "new" mortgage in your 50s, and, if yes, for how long of a time period?

TIA!

Terri

Absolutely, positively would not a mortgage when I am retired. DW and I were 25 when we bought our house, no kids, and got a 15 year mortgage because we wanted the house paid off BEFORE our then unborn kids hit college.

 

[scrapquitler]

I'm 47, DH is 51. We are looking at buying a home possibly. (If it matters, we have a 20% downpayment for this purchase from the sale of our last home, and our current home is paid off, although worth very little.)

I feel very, very strongly that I don't want to go beyond a 15 year mortgage, because I don't want to have a mortgage during retirement. DH does not agree.

Have you/would you want to have a "new" mortgage in your 50s, and, if yes, for how long of a time period?

TIA!

Terri

I would go with a 15 year mortgage, but that's my personal 'rule' in general, regardless of age because you pay so much less interest that way.

 

[disneychrista]

30 years. You can always pay it off faster, but you cannot make lower payments on a 15-year mortgage if you run into any problems with cash flow in the future.

This is my feeling too. I have always paid more than the minimum and should have my 30 year paid in 20.

 

[DebbieB]

30 years. You can always pay it off faster, but you cannot make lower payments on a 15-year mortgage if you run into any problems with cash flow in the future.

This was my thought when I got a 30 year at age 52. I'm paying an extra $221 a month which will take off 11 years. I have a pretty good nest egg in my 401k, so I figure I can use that if I need to after age 59 1/2, not sure when I plan to retire. The 15 year payment amount was too much of a stretch.

 

[MichiganKris]

I would go with the 30 year and pay extra on it for the same reason as above. If something happens and you can't make the payment amount on the 15 year you are stuck.

 

[toystory1130]

What would you do if either of you do not reach your targeted retirement age? Due to medical problems, you could be forced into a early retirement and would still have that house payment. (and with less $$ than you thought you'd have) Just a thought...

 

[Anthony1971]

I'm 47 and just bought a house. My fiance is 51 and moved in and our plan is to doulbe up on the payments after we pay off his car in 2 years. In the mean time, I will probably make 2 or 3 extra payments a year. We plan on having it paid off in less than 15 years. If you can do it, go for it!

Than we said we will become snowbirds and head to FL when it gets too cold in IN. lol

if you make double payments make sure you specify to the teller it is principal only and check after it is applied.... a lot of tellers in front of you or mailed in will gladly make your double payment an early next month payment interest and all... yes you will pay the full interest as you will then not have a payment due.

 

[Gracie09]

My parents bought a new house with a thirty year mortgage in their fifties. They then later refinanced it to a 15 and their payments only went up about $100 a month due to a decrease in interest rates. They both retired early and have a few more years to pay in it although they are now talking about selling and downsizing so who knows what they will end up with.

 

[OhMari]

Doesn't it stink that the value of our homes are so low. If we lived out iEast or in California, we could sell and buy 3 homes here.

We are actually meeting with our builder next week and he is going to tell us how much it is going to cost us to build. We have met with him a few times and eliminated things to bring the cost down. We were going to have a walk out basement, no fireplace, eliminated the screened in sunroom. The problem we are facing is the cost is exceeding the value that the banks are appraising the new houses for. So we may be under water and have to come up with the extra money on our own if the bank comes in under the cost of building.

My dh doesn't care if we have a mortgage, me I would rather stay in our house and be a snowbird. I hate winter.

 

[disney1990]

If you really are dedicated enough to make the 15 year payments, go ahead and get a 30 loan but make the 15 year payment each month. That is exactly what we did. If however you will let other things get in your wat and can't be dedicated, I would go with the 15 year loan. Our house was paid off before my DH's retirement - a condition of him being able to retire.

 

[yoopermom]

Doesn't it stink that the value of our homes are so low. If we lived out iEast or in California, we could sell and buy 3 homes here.

My dh doesn't care if we have a mortgage, me I would rather stay in our house and be a snowbird. I hate winter.

Mari,
I completely agree with you. We sold our farm 9 years ago when prices were still decent, luckily, but have been sitting in this "summer cottage" since then, trying to decide whether or not to jump into a mortgage again.

DH would live here until we die and then be buried in the back 40. I would snowbird the second after I retire .

Sigh....

Terri

 

[lovewdwdvc]

I suggest that you go long with the mortgage, tell yourself that you are paying it off in 15 and invest the difference.

 

[TwoAtDisney]

Always go for the 30 years, UNLESS the difference in interest rate is significant. You can always pay it off in 15 years, if God willing & the crick don't rise!

Having a mortgage in retirement is not always a bad thing. Why sit on a large amount of equity in a mortgage free home? Let your money work for you. At certain ages, the mortgage will never be paid in full by the homeowner - leave the payment for your estate! Of course, if not enough retirement income, may need to be mortgage free.

Some states/localities give a significant discount on real estate taxes if property has a mortgage.

If IRS Schedule A amounts are high enough, get tax write-off for mortgage expenses.

BTW, for those of you who plan to move to warmth when retire &/or snowbird, consider what we did - full time RVing. We loved it. Our house money made money for us while we left home ownership responsibilities behind. We bought a 31' travel trailer with slide out rather than a motor home - was much cheaper & no concerns about engine/transmission/etc. costs. During the winter, we stayed at Sherwood Forest in Kissimmee - not only minutes to Disney, but there's a Krispie Kreme on the corner!