Home Equity Planning...

sman said:
James,

At a 6% return, you are not going to get a 2-3% spread over the long haul.

Do the math, when you are paying on a simple interest balance whether it is I/O or fully amortizing and earning on a compounding balance given enough time you don't have to earn at or above your net cost to borrow, thanks to the power of compounding interest you can actually earn less and come out way ahead over time.

For example if you borrowed $100,000 at 9% fully amortizing without tax advantage and earned 7% in a tax free enviornment, net of costs you come out $471,561 ahead in 30 years. So you can borrow at 2% higher than you are earning yet come out $471,561 ahead and be more liquid along the way.
 
The purpose of this Planning Guide is to help you set up a home equity Planning for refinance. prtlimages.cunamutual.com
 
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