Paying off Mortgage with HELOC

Discussion in 'The Thunderdome' started by CardinalVol, Feb 7, 2017.

  1. CardinalVol

    CardinalVol Uncultured, non-diverse mod

  2. NorrisAlan

    NorrisAlan Put Custom Title Here

    Some of his numbers seem off. Like the $3000 and only spend $250 of it. Who can live a month on $250 bucks?
     
  3. JohnnyQuickkick

    JohnnyQuickkick Great Man

    Somebody explain this in English. I just don't have the wiring to understand this kind of stuff
     
  4. justingroves

    justingroves supermod

    It makes sense if you're disciplined enough to do it.
     
  5. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    You'd have to be very willing to live on a lot less than you make.
     
  6. NorrisAlan

    NorrisAlan Put Custom Title Here

    Sounds like something Leo Getz would come up with!
     
  7. TangoUniform

    TangoUniform Contributor

    This is correct.

    It's very possible to do it ... theoretically, it's possible ... but the premise (described at the link) makes a lot of presumptions when it "talks in round numbers".
    Not only do you have to have the willpower to make sacrifices (as CardinalVol says), but you better hope to be a lucky sum[itch bay] who doesn't have thing go wrong with the car, the house, the kids, or the wife, etc... especially the wife.

    ...best be DAMN sure you've got her on board and that she's just as willing and dedicated to the "team effort" as you are.... no secret credit cards, no binge spending because she was "feeling depressed", etc. etc. etc. Kids doing extra-curricular activities, sports, ballet, piano? All of that is OUT. Eating out is also out. Vacations are definitely out. Realistically, you're about to put yourself on a starvation diet that involves everything in your life.

    Yeah, in theory, it can work, but the reality is that ONE thing can blow it all up and put you in a world of hurt.

    Bottom line is that if everybody is on the same page about living under means, 'living with less', etc. etc., then you can accomplish the same exact goal by simply cutting expenses and saving money and putting extra towards the mortgage's principal. You can actually get dedicated enough to pay it off in the same time frame as the "ninja tactics" promise.

    These tactics remind me of one of those great lines from Hunt for Red October when Ramius says, "...When he reached the New World, Cortez burned his ships. As a result, his men were well-motivated."

    Well, that's kinda like what using those "ninja tactics" is doing. There's very little to no room for error, backslides, or big strokes of bad luck.
     
    Last edited: Feb 7, 2017
  8. zehr27

    zehr27 8th's VIP

    Also this is assuming you have virtually no other debt. Which is unlikely in today's world.
     
  9. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    I don't have a dime of debt outside of my mortgage.
     
  10. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    I've got a friend tossing it around and I've heard of it before. It's why I asked. It's pretty much way to risky and stressful for me to ever do. Like you said, one thing goes wrong and it crumbles. I'd rather just save up and pay down cash every so often.
     
  11. XXROCKYTOPXX

    XXROCKYTOPXX Chieftain


    I would opt to make additional payments towards the principle if you can swing it. I've read about the HELOC method before and as most other have said it's more complicated than this guy is making it out to be.
     
  12. NorrisAlan

    NorrisAlan Put Custom Title Here

    Yeah, I don't see you not needing a car, tires, glasses, doctor's visits, etc. Also, after 2 years, you would be freaking stir crazy and tired of bologna sandwiches.

    If you are single and have a starter home and are 24, it might be doable. Just don't plan on dating or getting married in that 4-5 years.
     
  13. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    The plan is to have it paid off in 5-6 years.
     
  14. droski

    droski Traffic Criminal

    pay your mortgage as usual and invest the difference. I don't get paying off something where you are borrowing at 4% even excluding the tax deduction.
     
  15. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    I want the free cash flow every month to do whate I want with it.
     
  16. droski

    droski Traffic Criminal

    how can you not do the same thing with an investment account?
     
  17. InVolNerable

    InVolNerable Fark Master Flex

    I'm happy just paying my sub 4% interest and pumping any extra into the S&P
     
  18. CardinalVol

    CardinalVol Uncultured, non-diverse mod

    Peace of mind of being debt free is worth the 1-2% net spread you get after taxes and fees.
     
  19. InVolNerable

    InVolNerable Fark Master Flex

    S&P saw 11.96% in 2016
     
  20. lumberjack4

    lumberjack4 Chieftain

    I know from a purely fiscal perspective it makes more sense to invest rather than pay additional towards my mortgage. However, I eschew debt and will have greater peace of mind with freeing up cash flow. I don't care that its not the correct fiscal option.
     

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