I wish I had no escrow. All that money sitting in the bank account earning no interest while at the same time I have to borrow that much more from the same bank to pay for the house at 6% interest.Originally posted by: FoBoT
no escrow?
Originally posted by: dullard
$2900 is fairly typical for a house. Didn't you know about this well ahead of time?
I wish I had no escrow. All that money sitting in the bank account earning no interest while at the same time I have to borrow that much more from the same bank to pay for the house at 6% interest.Originally posted by: FoBoT
no escrow?
Originally posted by: MadPeriot
I just got my property tax bill too for the next year, man it hurted when I opened it. Not sure how I'm going to pay for it without tampering with the parent plan. I purchased last Sept as well. This is in So. Cali.
Originally posted by: FoBoT
no escrow?
Then please tell me how it works, as you seem to know it all.Originally posted by: IcebergSlim
huh? no. thats not how it works.
Originally posted by: Danman
It's ridiculous here in Florida, especially Orlando. My fiance and I really wanted to buy a townhouse, but we can't afford it due to this market. I make a decent living, and I just don't see how people afford it, it's crazy.
Originally posted by: dullard
Then please tell me how it works, as you seem to know it all.Originally posted by: IcebergSlim
huh? no. thats not how it works.
Suppose I want to buy a $100,000 house. Suppose there are $3,000 in closing costs (including $1500 for the escrot). Suppose I have $23,000 available up front for the house. Suppose the interest rate is 6.5%. How much do I borrow? How much interest do I pay on the first payment?
[*]I borrow $100,000 + $3,000 - $23,000 = $80,000.
[*]The first payment interest is $80,000 * (.065/12) = $433.33.
If I had my WISH and instead got a 6.5% interest loan without escrot, I would have:
[*]$1,500 in closing costs.
[*]$78,500 borrowed.
[*]$425.21 in interest on the first payment.
In this example, I pay $8.12 more in interest for the first month with the escrot account than if I didn't have that escrot account. Also, I could take that $8.12 savings and pay off the house principal, each and every month, netting 6.5% interest savings (compounded). And, I could put the money that normally goes into escrot at 0% into investments earning more money. Then sell the investments when it is time to pay taxes.
Of course this dream isn't a reality. Banks will give no escrot mortgages in some areas, but at a much higher interest rate for the mortgage. That is why it is a WISH, not reality for me.
Originally posted by: amddude
Originally posted by: Danman
It's ridiculous here in Florida, especially Orlando. My fiance and I really wanted to buy a townhouse, but we can't afford it due to this market. I make a decent living, and I just don't see how people afford it, it's crazy.
It's worse in Daytona.
Thanks for the clarification. Sorry about razzing you.Originally posted by: IcebergSlim
I was under the impression that you were saying that your property taxes were included in your mortgage loan for the life of the loan when you were saying "all that money" as in tens of thousands of dollars.
Originally posted by: dullard
Thanks for the clarification. Sorry about razzing you.Originally posted by: IcebergSlim
I was under the impression that you were saying that your property taxes were included in your mortgage loan for the life of the loan when you were saying "all that money" as in tens of thousands of dollars.