Some things just don't make sense at all. It used to be that it just did not make sense to pay off your mortgage when money was so cheap, and you could write off the interest. It does not really matter how unwise it may be, but somehow, having that mortgage payed off sure feels good. I'm all for it.
Another thing we are told not to do is have your lender keep an escrow account for you, collecting each month in addition to interest and principal payments, to pay for taxes and insurance. Really, why give it to them, when you could have control of the money until you need it twice a year for taxes and insurance. In California, property taxes are due in December and April--the two worst months. You have Christmas and income taxes due. I don't care how unwise it is to have an impound account, but somehow, when I got my property tax bill yesterday, with the word Copy on it, I felt good. Almost like I was getting it for free, since I had been paying all along.
Does this make any sense at all, and would you advise your clients to do this when purchasing a home?
Comments(0)