Suppose you buy a $375,000 house, put down $75,000 and take out a $300,000 mortgage at 5.99 per cent (the lowest current five-year rate).The part that boggles my mind is... you take out a 40 year mortgage at age 25... you don't pay it off until you're ready to retire. That's an awful long time to be lining somebody else's pockets.
You'll pay almost $784,000 with a 40-year mortgage, compared with $575,000 on a 25-year mortgage (assuming the rate stays the same).
That's more than $200,000 in extra costs – and for what?
And for what?
By extending the payback period, you'll save only $285 in your monthly payments.That's really what's dragging society to its knees... it's all about the line of least resistance.
You could get the same bang for the buck – about $9 a day – by bringing your own lunch to work or taking public transit instead of your car.
Whatever that ends up costing.
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