get a high interest mortgage or take lump sum from pension or even 401k plan? (Gainesville: sale)

[Alfiehurt]

We are planning/hoping to buy a condo, hopefully mid 200's next year. We are renting now
I'll be short of at least 40K or more if we end up paying bet 250 and 300

I am in my early 60's, likely will work until my late 60's/early 70's, 10 years or less, give or take

my question is...is it worth it getting on 40-80K mortgage even for 10 years at 7 plus %? or does it make more sense cash a 50K approx. pension plan I have and take a lump sum? or even cash out some of my 401k plan?

[City Guy997S]

Call a MTG broker first and see what they can get you for a mortgage. There might not be anyone that wants to do a 40K mtg. It was a problem a few years go for a relative, the banks didn't want to do one that small.

[Alfiehurt]

I'm guessing they won't do it for less than 50K, right? maybe not even. Perhaps nothing under 100K

[wizrap]

When we bought our home in Gainesville 6 years ago, we decided to get a $100k mortgage, as we wanted to take some of the profits from the sale of our home in Weston and put it in our investment account.

We had our mortgage thru Chase down in Weston and when we called them to discuss a $100k mortgage in Gainesville, they turned down the business, saying they didn’t work with mortgages that small.

We have accounts at Bank of America and although they were interested, they eventually failed to return our calls. I have an account at a local credit union, and even though we had to jump through lots of hoops, we got great terms, 15 year fixed at 2.75%. The credit Union still hasn’t sold our mortgage and probably never will.

I agree with city guy—call a mortgage broker and/or check with the financial institutions where you have relationships. Also, be careful about taxes on withdrawals on retirement plans. You could see about 20% to 30% swept away to Uncle Sam.

It might be worth a call to call your 401k provider and/or pension plan and see if they offer loans against your account. The payments on loans used to purchase homes could be drawn out for as long as 10 years and although you’re paying interest, and lose out on potential opportunity growth since the collateral can’t be invested in the market, the loan is tax-free and you pay yourself back and don’t obliterate your account.

Good luck!

[Teacher Terry]

I have had no problems getting a mortgage under 50k. You will incur a lot of taxes taking retirement money when you are still working.

[Alfiehurt]

Originally Posted by Teacher Terry

I have had no problems getting a mortgage under 50k. You will incur a lot of taxes taking retirement money when you are still working.

Would you mind telling which bank you used, please?
I have no idea where to start

[Alfiehurt]

Originally Posted by wizrap

When we bought our home in Gainesville 6 years ago, we decided to get a $100k mortgage, as we wanted to take some of the profits from the sale of our home in Weston and put it in our investment account.

We had our mortgage thru Chase down in Weston and when we called them to discuss a $100k mortgage in Gainesville, they turned down the business, saying they didn’t work with mortgages that small.

We have accounts at Bank of America and although they were interested, they eventually failed to return our calls. I have an account at a local credit union, and even though we had to jump through lots of hoops, we got great terms, 15 year fixed at 2.75%. The credit Union still hasn’t sold our mortgage and probably never will.

I agree with city guy—call a mortgage broker and/or check with the financial institutions where you have relationships. Also, be careful about taxes on withdrawals on retirement plans. You could see about 20% to 30% swept away to Uncle Sam.

It might be worth a call to call your 401k provider and/or pension plan and see if they offer loans against your account. The payments on loans used to purchase homes could be drawn out for as long as 10 years and although you’re paying interest, and lose out on potential opportunity growth since the collateral can’t be invested in the market, the loan is tax-free and you pay yourself back and don’t obliterate your account.

Good luck!

Thank you for the feedback
The financial institutions where I have relationships are the big guys: Chase, Capital One

Would you mind sharing which credit union you went to?

Thanks

[wizrap]

Alfie, I got my mortgage through Space Coast Credit Union. They are based in Melbourne, and have branches all up the east coast of Florida. Ironically, none up here in Gainesville but that didn’t impact their decision to give me a mortgage.

Good luck!

[Alfiehurt]

Originally Posted by wizrap

Alfie, I got my mortgage through Space Coast Credit Union. They are based in Melbourne, and have branches all up the east coast of Florida. Ironically, none up here in Gainesville but that didn’t impact their decision to give me a mortgage.

Good luck!

Hi!
Did you get a competitive rate compared to the big corp banks?
I hear they can grant mortgages as low as 50K