I always seem to be out of sync with the financial cycles. When we bought our house, interest rates were 10%. Hard to believe. Equally hard to believe is that the money market account from which we drew our down payment was paying around 9%.
So horrified was I by the payments that I paid extra each month, and ended up paying off the house a few years ago. Can we say AHHHHHH? Meanwhile, and I suppose it was lucky, I missed out on all the cash out refis some of my "friends" in the mortgage biz were urging upon me.
But now...I read last night that mortgage rates are at historic lows--under 4% for 15 years. Now I don't have any immediate need for a big wad of cash (college costs are taken care of). AND I certainly can't get more than a 1-2% return on any sure thing. At the moment.
But surely interest rates will rise some time in the next 15 years, right? Or, even more surely, in 30 years. There is a school of financial thought that says "Always have a mortgage." Can you imagine how little my new mortgage payment would seem in 10-15-20-30 years? Heck, I might not make it that far.
I may do some more math on this. Would this not be a decent way to get some "income" in retirement? It would be cheaper than a pricey and complex reverse mortgage.
Any thoughts on this? Is it a crazy idea?