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Would it be stupid to take a house loan out for 40 years instead of 30 to get lower payments, then refinance later on down the road?


Asked by Anonymous at 11:27 AM on Jul. 2, 2009 in Money & Work

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Answers (3)
  • You are just paying more and more interest the longer you finance a home for. For our home the difference in interest on a 15 year mortgage vs a 30 year mortgage is a little more than $30,000. The difference in the payment that we would make is $125. So by paying $125 less each month for 30 years, we would be giving the bank $30k. When you refinance, you are going to be giving the bank several thousand dollars to refinance....closing costs, and all that is involved. The smartest thing you can do is to do it right the first time. Which would be to have 20% to put down and finance for 15 years. Like I said, that's the smartest thing, aside from having 100% to put down......

    Answer by slw123 at 11:59 AM on Jul. 2, 2009

  • If you are not worried about paying off the loan..I think it is a good idea. Like you said it would make the payments cheaper..I hope your interest is low.  that makes of differance too in the price.


    Answer by louise2 at 11:32 AM on Jul. 2, 2009

  • If you can't make the payments on a 30 yr loan, you can't afford a house.

    Answer by Anonymous at 11:47 AM on Jul. 2, 2009