What if you're a stacker with a mortgage?

Everyone has to make their own decision in this type of situation and judge their risk tolerance. For me, I am refinancing my mortgage and then will take out additional dollars on a 1yr -0-% credit card draw to buy more gold. The mortgage refi has drawn on so long that gold has gone up $2-300 since I started. I anticipate US inflation will be higher and the mortgage will be paid with cheaper dollars. Note that I have other investment assets that could be used to pay off the credit card draw and the mortgage.
 
Don't take money out on the mortgage to buy silver just keep chipping away at both you're building a stack and paying off your home. SHTF may happen tomorrow or 10 years from now or not at all. Regardless we all need a roof over heads.

I owe a little bit on my house (less than 10 percent) but I still want to get that paid off . I'm making payments and stacking a little too. Dont do anything drastic, and if you must, sell your house and downsize into something cheaper and reduce your debt. Then use the extra funds to stack. When property drops you'll take less of a hit on a cheaper place and then you could sell the smaller house and some metal and upgrade to what you really want.
 
Have you thought about selling the house buying a cheaper one with your equity & being debt free then ploughing all your money into PMs ?.No debt...No stress... good times.
Just another option. Do what you feel is the best for you
 
errol43 said:
SilverPhoenix said:
I'm in this situation. Have forward paid mortgage for a while (about 6 months ahead) and am now building a (smallish) stash.

If SHTF day comes, what use is paying off a mortgage to a bank that'll take the money and fold? The silver will keep the family alive and well (and a shotgun will keep off the rampaging mobs of unprepared).

Is my position morally questionable and dishonourable given I'm happy to welsh on a debt if the system goes down? Maybe. My thought is that if the system fails, all bets are off and its time to re-order priorities.
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You say that you are six months ahead with your payments..Does it make any difference to the amount owing on the loan or does it mean obviously that IF TSHTF that you will be right to pay no payments for 6 months or does it go to Capital reduction?

If would seem to be a shame to give the bank thousands of dollars at 0%..Why not pay 2 payments ahead and ride the silver tiger and If TSHTF sell the silver tiger, and you might even have enough fiat to keep the wolves from your door for a much longer time.

Please do not take this as advice or anything like that..I was just pondering of what I would do in a situation as you describe.

It is always good to see people trying to make themself and their family secure in such a crazy world that we have today.

Regards Errol 43
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Those payments reduce the interest I have to pay on the outstanding balance by reducing the principal directly. I can redraw. That is, I can withdraw under normal circumstances. I personally believe on SHTF day, all bets are off - if i can get the money back then, I'd consider it a bloody miracle (not using profane language - I'd probably have to fight hard just to get thru the panicked mob just to get to the doors, then do the same again to get to the counter. I'm assuming intenet banking would be shut down.)

Right now I'm trying to balance bars against coins, gold against silver. Initially people will accept silver and gold coins because they are accustomed to thinking of those round metal things as "money". Later people will be more accepting of bars.

Thats my thinking at this stage anyway :)
 
Ag-ness said:
Hmmm. If I max out my mortgage, we will have trouble affording the repayments. The extra I have in redraw is what keeps it affordable, at least until I get out of uni. I know uni is no absolute guarantee of a good job, but a full time job of any description would see us laughing. Even if I pay the minimum necessary on the mortgage, there isn't a huge amount left over to go crazy on silver anyway. I'd still like to, though. :)
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oops! i see you're in Brissie... so selling is out of the question now. unless you're happy to take a haircut.
The tsunami has not yet reached Melbourne and Sydney but it will. Those having property there should sell up before its too late and invest the proceeds in PMs
 
I think Sargeant Argent said it best. You're building a stack and paying off your home. It isn't any more complicated than that really. Unless you go with Matrix's idea of kidnapping census collectors. I don't want to have to cook for that many. Thanks for the opinions and more are welcome! Anyone in serious "mortgage stress"?
 
In effect you have a margin loan for any investment outside of paying down your mortgage. 6% mortgage rates means any money you invest must earn more than 9% a year to get ahead of paying off the mortgage.

eg. $10,000 x 9% = $900 return less tax payable of your tax bracket of say 30% (31.5% in medicare) means you will clear $616.00

To pay off your mortgage @ 6% would be $600 return.
 
Matthew 26:14 said:
In effect you have a margin loan for any investment outside of paying down your mortgage. 6% mortgage rates means any money you invest must earn more than 9% a year to get ahead of paying off the mortgage.

eg. $10,000 x 9% = $900 return less tax payable of your tax bracket of say 30% (31.5% in medicare) means you will clear $616.00

To pay off your mortgage @ 6% would be $600 return.
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You're quite right. However, neglected in to include the effects of inflation, which while not considerable, is still an important factor.

BTW, thanks for this post and pointing this out clearly.
 
hotel 46 said:
you have to wear the shoe that fits. being happy and content is the most important of all. a caravan, semi detached or a mansion, renting paying of or owned outright can all be perfect, if you feel the need to have a big house and a flash car of you go. one day you will leave it all behind so enjoy the journey,its all about the ride.
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YEAH! You come ito the world naked, bloody and screaming. Would prefer to go out with a bit more dignity. But leave it we all will, naked and broke. Looking after the kids is the only justification but not if you sell you soul or alienate them.

Having said that, I'd rather be happy with a nice stash of PM than happy without it :D
 
SilverPhoenix said:
hotel 46 said:
you have to wear the shoe that fits. being happy and content is the most important of all. a caravan, semi detached or a mansion, renting paying of or owned outright can all be perfect, if you feel the need to have a big house and a flash car of you go. one day you will leave it all behind so enjoy the journey,its all about the ride.
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YEAH! You come ito the world naked, bloody and screaming. Would prefer to go out with a bit more dignity. But leave it we all will, naked and broke. Looking after the kids is the only justification but not if you sell you soul or alienate them.

Having said that, I'd rather be happy with a nice stash of PM than happy without it :D
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Yes, I will leave it all behind, but the "it all" will be a house and whatever stack I didn't spend in retirement. I have a good son. My sister's kids are good too, but (by her) they will be left a half filled ashtray, a 3 legged bed and probably the chore of returning all her rented dross. I think there was only one financially savvey brain available in my generation.

Yes, I'm aware that is not how you spell the word s a v v y, but stop-hammertime kinda doesn't go with what I was trying to convey.
 
Yippe-Ki-Ya said:
Ag-ness said:
Hmmm. If I max out my mortgage, we will have trouble affording the repayments. The extra I have in redraw is what keeps it affordable, at least until I get out of uni. I know uni is no absolute guarantee of a good job, but a full time job of any description would see us laughing. Even if I pay the minimum necessary on the mortgage, there isn't a huge amount left over to go crazy on silver anyway. I'd still like to, though. :)
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oops! i see you're in Brissie... so selling is out of the question now. unless you're happy to take a haircut.
The tsunami has not yet reached Melbourne and Sydney but it will. Those having property there should sell up before its too late and invest the proceeds in PMs
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As I've been away from researching the property market for some time, I have no idea what's happening around the country...just interested in what's happening in Brissie? Is it a post-flood issue or combination of factors?
 
I have to pay a mortgage out of a VERY modest income but I have started to stack a little with 'spare' cash and I intend to keep on doing both for the foreseeable future.

Given the choice I would go for the mobile home option....but I have yet to find a buyer for my kids. :/

Any offers? PLEASE?!?
 
Ladybird said:
I have to pay a mortgage out of a VERY modest income but I have started to stack a little with 'spare' cash and I intend to keep on doing both for the foreseeable future.

Given the choice I would go for the mobile home option....but I have yet to find a buyer for my kids. :/

Any offers? PLEASE?!?
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Sorry, I'm also selling. And, no thank you, no swaps - fiat or PM only! :D
 
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