I was going thru some old papers from when I was married, I had a large folder with mortgage paperwork from when we bought a house back in 2001. I got to looking at the interest rate, length of the note, and what the house was listed for initially and dont understand a few things, this concerns everyone that has ever bought house and had a mortgage.
The house we bought was listed for $ 94,000. we took out a 30 yr loan on it, our interest rate back then was around 6%. I remember our monthly payments were about $750...the strange thing happened, when I thought if we had stayed together and paid every month of that house for the entire 30 yrs, we would have paid $270,000...???!!!
I know banks dont make that kind of profit from financing houses, so Im curious how it got to this large of an amount?
Plus, my brother and his wife just bought a nice house, he said their monthly payments are about $1200. a month, I looked online to see what the selling price of the house was that they bought, it was $280,000, but again, when I added up their payments, they will end up paying a little over $432,000.
This doesnt make sense...if this is accurate, then people that pay off their houses are loosing their asses in the deal!! I know houses dont appreciate this much, even over 30 yrs!!
Can anyone explain this? I know I cant be the first person to recognize this difference.
The house we bought was listed for $ 94,000. we took out a 30 yr loan on it, our interest rate back then was around 6%. I remember our monthly payments were about $750...the strange thing happened, when I thought if we had stayed together and paid every month of that house for the entire 30 yrs, we would have paid $270,000...???!!!
I know banks dont make that kind of profit from financing houses, so Im curious how it got to this large of an amount?
Plus, my brother and his wife just bought a nice house, he said their monthly payments are about $1200. a month, I looked online to see what the selling price of the house was that they bought, it was $280,000, but again, when I added up their payments, they will end up paying a little over $432,000.
This doesnt make sense...if this is accurate, then people that pay off their houses are loosing their asses in the deal!! I know houses dont appreciate this much, even over 30 yrs!!
Can anyone explain this? I know I cant be the first person to recognize this difference.