The 35 year mortgage on the rise
Hi there! I'm Jayna Sheffield at the business desk.
Not sure how many of you know about the rising trend towards the 35 year mortgage that seems to be taking off across North America these days but here goes.
More and more financial institutions across North America are offering the 35 year mortgage to home buyers as a means of enticing them to buy homes that would normally be out of their reach. What this means is that buyers would now have an opportunity to carry a mortgage that they can share with their kids and even grand kids. So, mom and dad would buy the house today and start off paying the mortgage and 20 to 25 years later the kids would then pick up the slack and continue to pay this very long term mortgage and if it came to that the grand kids would probably get into the mix as well.
Banks are promoting this mortgage as a means of encouraging younger couples to buy bigger homes, their dream homes. However, what they are not telling these potential big home buyers is that by the time the mortgage is paid off the family as a whole would have paid thousands of dollars more in interest which would amount to paying almost twice the amount for the house. In summary: Let's say that the house were to cost $300,000 today and Mr and Mrs Smith were to take out a 35 year mortgage. In 35 years time when the mortgage is supposed to be paid off the Smith family would have paid more than $500,000 in total for the house. Yes, interest payments over the course of the 35 years would probably account for this huge total.
Before you decide to go into this type of mortgage, do your calculations and figure out what it is going to cost you and your family in the long run. I can guarantee you that a house you buy today for $300,000 would very likely end up costing you and your family much more in 35 years from now. In addition, you need to think about whether or not your kids would be in a position to continue the payments.
On another note: If you're looking to get your kids started on their own business venture for the Summer then you may be in luck. "Untapped Wealth discovered" has several ideas that you can use to help you out. This book contains some very interesting strategies for your kids and many of them are easy, economic, and simple to put into operation.
Visit www.untappedwealth.com/order.htm to pick up a copy of this book which is well priced to suit your pocket.
Not sure how many of you know about the rising trend towards the 35 year mortgage that seems to be taking off across North America these days but here goes.
More and more financial institutions across North America are offering the 35 year mortgage to home buyers as a means of enticing them to buy homes that would normally be out of their reach. What this means is that buyers would now have an opportunity to carry a mortgage that they can share with their kids and even grand kids. So, mom and dad would buy the house today and start off paying the mortgage and 20 to 25 years later the kids would then pick up the slack and continue to pay this very long term mortgage and if it came to that the grand kids would probably get into the mix as well.
Banks are promoting this mortgage as a means of encouraging younger couples to buy bigger homes, their dream homes. However, what they are not telling these potential big home buyers is that by the time the mortgage is paid off the family as a whole would have paid thousands of dollars more in interest which would amount to paying almost twice the amount for the house. In summary: Let's say that the house were to cost $300,000 today and Mr and Mrs Smith were to take out a 35 year mortgage. In 35 years time when the mortgage is supposed to be paid off the Smith family would have paid more than $500,000 in total for the house. Yes, interest payments over the course of the 35 years would probably account for this huge total.
Before you decide to go into this type of mortgage, do your calculations and figure out what it is going to cost you and your family in the long run. I can guarantee you that a house you buy today for $300,000 would very likely end up costing you and your family much more in 35 years from now. In addition, you need to think about whether or not your kids would be in a position to continue the payments.
On another note: If you're looking to get your kids started on their own business venture for the Summer then you may be in luck. "Untapped Wealth discovered" has several ideas that you can use to help you out. This book contains some very interesting strategies for your kids and many of them are easy, economic, and simple to put into operation.
Visit www.untappedwealth.com/order.htm to pick up a copy of this book which is well priced to suit your pocket.
posted by Editor at
3:53 PM
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