In article <1123772136.338793.150880[at]g44g2000cwa.googlegroups.com> ,
throatwobblermangrove[at]comcast.net wrote:

- quote -

As an exercise, try running both scenarios through a tax software
program like Turbo Tax. What you will find is that for more
average everyday people, you get almost no value out of the
tax write off. The extra write-off for $20K would be pretty
small, if anything, and that is not worth putting your house
at risk.

In order to get the benefit of the tax write-off, you have
to itemize, and you have to have deductions that are above
and beyond in value of the standard deduction. Put another
way, you get a pretty big standard deduction just for being
alive. You have to have deductions that exceeded that number
before you are in the profit zone with a home mortgage.
Everyday people generally don't have those kinds of deductions
unless there is something out of the ordinary going on in
their family.

My advice about how to lower your credit card debt is good
advice since you are optimizing dollars, not playing with
pennies like the tax deduction would.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

What about the tax write off. Wouldn't that be enough to offset the
expense and make the effective rate actually be lower? Not to mention
that you can't write off credit card debt.

In article <1123724523.697749.228600[at]g49g2000cwa.googlegroups.com> ,
throatwobblermangrove[at]comcast.net wrote:

- quote -

If there is little or no cost to this loan, then go for it.
If there is a cost, it has to have a payback period of a year
or less to be worth messing with.

In either case, you are going to want to refi in about 3 years
when your credit is much better. You don't want to be paying
rip-off rates forever.

I wouldn't bother trying to roll in the $20K. Any debt over
your equity value of your house gets much higher rates anyway,
so it is almost the same as keeping it on credit cards. You
also don't want to convert a short term debt into a long term
debt (ie, paying for a pizza over 30 years), nor do you want
to convert unsecured debt into secured debt (ie, put your house
up to back that pizza).

Your best bet with the credit card debt is to (1) try to
get lower rates, (2) surf for better rates, (3) cut expenses
like crazy to pay off the cards, (4) hold a garage sale and
sell what you can on E-bay, (5) consider ways to earn extra
income for a short period of time.

-john-

--
================================================== ====================
John A. Weeks III 952-432-2708 john[at]johnweeks.com
Newave Communications http://www.johnweeks.com
================================================== ====================

Hello,

I just hit a year with my first mortgage at Countrywide. They've come
to me offering an 80/20 3 year ARM.

My current loan with them is a 2 year ARM with a rate of 9.6% (yes high
because it was a 100% and my credit was an issue) with a pre-pay. But I
was planning of refying out of that before the 2 year mark. My payments
are 1260/mo.

I also have about 20K credit cards debt. which I'd like to get rid of.

Anyway, now they offer me this:
$165000 Loan Amount 80%-- $132000 [at]6.50% 20%-- $33000 [at]10.125%

$1126.98 Loan payment

3 year fixed

$1126.98 (new payment)

I'm not sure if the 3 year fixed is only for the 80 part of it, I have
to find that out.

Anyway, would this be beneficial for me to roll in the credit card debt
into this? Would I stand to save some real $$ doing this or is it bad
in the long run? I'm not sure. Loan people don't usually come out with
all the info up front, you have to pry it from them.

What should I worry about with this deal?

By the way, I plan to stay where I'm at between 7 and 10 years.

Thanks for any advice,
--TWM