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Originally Posted by Fat Charlie
That was the beauty of it: insurance and taxes were rolled into the payment. The bank set it up that way because they didn't want their collateral going away because someone wasn't ready for the biannual tax bill. When the market kept going up we got it reappraised and ditched the PMI, which was also rolled in.
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That is how my first mortgage was set up. None of the rest have been and it is a more expensive way to do it then just paying those expenses directly. It is also very unlikely you had earthquake or flood insurance packaged in if they apply to your location. Standard homeowners doesn't cover either.
My first house worked out OK but looking back had a lot of risk.
Quote:
Originally Posted by Fat Charlie
Saving money while paying down your own mortgage is hard enough. It's even harder when paying down someone else's mortgage.
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Home ownership has pluses and minuses. Long term it is cheaper to own. Short term renting is much more flexible and the landlord assumes a lot of risks.
Also most people underestimate what they spend on their house by leaving out the maintenance and other home related expenses. Things like a lawnmower, line trimmer, yard tools. I remember when I closed on our first house we were pretty tapped out from coming up with the down payment and closing expenses. We moved in and I looked at the grass and said "crap, now I have to go buy a lawn mower to cut this 1 acre lot" I couldn't afford a rider so I cut that lot for more than a year with a little walk behind.
Mint tells me I have spend $9,416 at Home Depot, $1,153 at Lowes, and $5,971 on a heat pump in the last 5 years. That is $276 a month.