[Mortgage Is ‘Just A Fancy Bullsh*t Word For Paying Rent For 30 Years To The Bank,’ Says Real Estate Billionaire Grant Cardone — Here’s Why Renting Could Be A Better Financial Move
](https://finance.yahoo.com/news/mortgage-just-fancy-bullsh-t-171148202.html?guccounter=1)
Yes and no. Ownership is valuable. But the flexibility to live and move with less responsibility is also valuable.
Yes and no. Ownership is valuable. But the flexibility to live and move with less responsibility is also valuable.
It’s not a matter of responsibility, you’re responsible for making a payment each month, either way, so that cancels out.
Your paying the same kinds of money out of pocket each month in either case. You might as well own what your emptying your wallet for when you’re done, than not. Wealth begets wealth, it snowballs.
In understand your point. It costs money to buy, sell, and broker house/mortgage. People have to live in their houses (in a normal economy) for like 3-5 years before even making a break even point on home. Just bought my first house and we’re drowning in interest at the moment. Rents will fall faster when interes rates change than we will be able to refi. BUT it’ll be better for us in the long run.
It costs money to buy, sell, and broker house/mortgage.
Its true that you need to save up the initial down payment. But in the long run it’s smarter to do so, than renting.
People have to live in their houses (in a normal economy) for like 3-5 years before even making a break even point on home.
It’s definitely not a short-term investment, unless you really try to play the real estate market.
But I’m not speaking towards trying to turn a short-term profit, just not having a short/long-term loss.
Put it another way, whose mortgage would you want to pay off, yours, or someone else’s?
Finally, real estate prices continue to always go up, so even if you had to sell short-term where you’ve been paying mostly interest you could probably sell the property for more value to make up the difference.
Just bought my first house and we’re drowning in interest at the moment.
All home loans are mostly paying interest up front, it’s not into the later years of the loan when you start paying substantial principle payments.
A neat trick is to always make an extra small principal only payment with each month mortgage payment, and that can change a 30 year loan to an 18 year loan.
Just make sure the write in the memo field on your check “principal only payment”, or else the loan company will try to just take that extra money and put it on the interest only portion of the loan (they’re tricky that way).
Rents will fall faster when interes rates change
Historically rental costs have always gone up, and not down.
Did you mean the monthly mortgage payment amount on a home loan?
BUT it’ll be better for us in the long run.
Ownership truly is better.
You’re going to spend (usually a bit) more per month on mortgage payments than rent, so it’s not really “the same kinds of money”.
Is this true in the US? Its definitely not been true anywhere I’ve lived in Europe. A mortgage has always been cheaper for a larger property, it’s just gathering the initial deposit to buy that’s the hard bit.
It’s not just money. Ownership means taking care of the house, and dealing with the buying/selling process. Would you advocate that university students buy a house for three years then sell again?
A good rental means you’re paying the landlord to take care of things for you.
I agree in the long term, since we always need somewhere to live, that personal ownership is better; but if you’re moving a lot, or perhaps depending on your job situation, I think renting is a valuable service for many people.
Would you advocate that university students buy a house for three years then sell again?
Assuming a university student had enough income, yes, most definitely. But most people buy houses after college, as they are busy paying for/off college first.
But realize that monthly rent payment is going to be about the same price as a monthly mortgage payment.
I agree in the long term, since we always need somewhere to live, that personal ownership is better; but if you’re moving a lot, or perhaps depending on your job situation, I think renting is a valuable service for many people.
Well just realize that you’re losing money by taking advantage of that service, and then, yes, it is valuable service, but also a more costly service.
Is it more convenient for you to have food already cooked delivered to you? Yes, of course. Will it cost you more money, will you lose more money, than if you went to the grocery store, got the ingredients, brought it home, and cook the food yourself? Most definitely.
The point I’m making is don’t pay somebody else’s mortgage off, pay your own mortgage off.
A good rental means you’re paying the landlord to take care of things for you.
While strictly true, and I do not mean to be insulting, but that is a very financially dumb thing to say.
As I mentioned previously, you’re giving your money to the landlord so that he can earn more money for himself, versus getting your own property and earning money for yourself.
Make your money work for you, and not for someone else. You earned that money.
Afaik the mortgage market (setting mortgage payments, type of mortgage: fixed vs floating) is one of the more efficient markets. So choosing rent/own might not be such a big dilema.
Current state (continuous rise of home prices) is, however, concerning. It used to be that USA’s flexibility to move (and refi) was its great advantage (in labor market).
