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Is Taking a Mortgage the WORST Decision Ever??
Rank: Member Joined: 8/5/2011 Posts: 125
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Just paid the first instalment into a 25 year old home loan (aka slow death). My reasons for going into mortgage:
1. Peace of mind... since my family must live somewhere, it had better be in MY HOUSE
2. Expense savings: initially an oxy-moron since 96% of the premiums go to interest payment. But the mortgage is 150% of the rent for that hse after raising 15%.
In my previous house I noticed that rent had doubled in about 5 years. So I am thinking long term here
3. Capital appreciation: with the estimated 12% annual capital appreciation, I am building equity that am living in, and I can tap into for whatever
Disclaimer: I am praying to God and i have every intention of clearing the loan before term (every 80% of premiums paid in advance eliminates 11 instalments (direct savings)
Wish me luck
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Rank: User Joined: 1/20/2014 Posts: 3,528
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kiwaru wrote:Just paid the first instalment into a 25 year old home loan (aka slow death). My reasons for going into mortgage:
1. Peace of mind... since my family must live somewhere, it had better be in MY HOUSE
2. Expense savings: initially an oxy-moron since 96% of the premiums go to interest payment. But the mortgage is 150% of the rent for that hse after raising 15%.
In my previous house I noticed that rent had doubled in about 5 years. So I am thinking long term here
3. Capital appreciation: with the estimated 12% annual capital appreciation, I am building equity that am living in, and I can tap into for whatever
Disclaimer: I am praying to God and i have every intention of clearing the loan before term (every 80% of premiums paid in advance eliminates 11 instalments (direct savings)
Wish me luck There is the catch. Manage that well and you will be home and dry! you also need to try hard to bring it to over 50% of repayment going towards paying the loan principal not interest! Formal education will make you a living. Self-education will make you a fortune - Jim Rohn.
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Rank: Elder Joined: 5/25/2012 Posts: 4,105 Location: 08c
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obiero wrote:dunkang wrote:kamaug wrote:Mortgage isn't working for me... I feel that the bank is taking a hard line especially since the split of interest and principle is 93%!! which means if my instalment is 100k 93k is interest only 7k is principle. My Business has hit some headwinds but the bank isn’t having any of that. Any valuable advice would be welcome.  JUST SELL IT!!! Woke up at 5.35am today js thinkin of my home debt. I dont like to call it mortgage since I found out that the word means 'death grip' in latin @obiero why loose sleep over small matters (judging from post #108 Posted : Wednesday, August 07, 2013 7:39:26 PM RINKobiero wrote:
I bet all my shares in BoK, COOP, KQ, land in Kitengela, Kakamega, Kisii, house, hotel and two cars; that KCB will not report a profit higher than 7%up from the KES 8.5B of H1 2012..
Pesa Nane plans to be shilingi when he grows up.
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Rank: Elder Joined: 6/23/2009 Posts: 14,318 Location: nairobi
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Pesa Nane wrote:obiero wrote:dunkang wrote:kamaug wrote:Mortgage isn't working for me... I feel that the bank is taking a hard line especially since the split of interest and principle is 93%!! which means if my instalment is 100k 93k is interest only 7k is principle. My Business has hit some headwinds but the bank isn’t having any of that. Any valuable advice would be welcome. JUST SELL IT!!! Woke up at 5.35am today js thinkin of my home debt. I dont like to call it mortgage since I found out that the word means 'death grip' in latin @obiero why loose sleep over small matters (judging from post #108 Posted : Wednesday, August 07, 2013 7:39:26 PM RINKobiero wrote:
I bet all my shares in BoK, COOP, KQ, land in Kitengela, Kakamega, Kisii, house, hotel and two cars; that KCB will not report a profit higher than 7%up from the KES 8.5B of H1 2012..
Haha. Pesanane wewe ni mtu hatari.. I wrote that ages ago.. Anyways, it is common knowledge to most that I am not a poor man, far from it.. COOP, IMH, KEGN, KQ, MTNU
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Rank: Elder Joined: 6/23/2009 Posts: 14,318 Location: nairobi
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kasibitta wrote:obiero wrote:dunkang wrote:kamaug wrote:Mortgage isn't working for me... I feel that the bank is taking a hard line especially since the split of interest and principle is 93%!! which means if my instalment is 100k 93k is interest only 7k is principle. My Business has hit some headwinds but the bank isn’t having any of that. Any valuable advice would be welcome. JUST SELL IT!!! Woke up at 5.35am today js thinkin of my home debt. I dont like to call it mortgage since I found out that the word means 'death grip' in latin @Obiero...i actually thought 'mortgage' is a french word for slow death. @kasibiita.. it is true.. we are both right. latin and french both point to the fact that a death grip shall result in ones slow death. someone asked me to show then just one person who has ever cleared a mortgage!!! I found none.. COOP, IMH, KEGN, KQ, MTNU
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Rank: Elder Joined: 5/27/2008 Posts: 3,760
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kiwaru wrote:Just paid the first instalment into a 25 year old home loan (aka slow death). My reasons for going into mortgage:
1. Peace of mind... since my family must live somewhere, it had better be in MY HOUSE
2. Expense savings: initially an oxy-moron since 96% of the premiums go to interest payment. But the mortgage is 150% of the rent for that hse after raising 15%.
In my previous house I noticed that rent had doubled in about 5 years. So I am thinking long term here
3. Capital appreciation: with the estimated 12% annual capital appreciation, I am building equity that am living in, and I can tap into for whatever
Disclaimer: I am praying to God and i have every intention of clearing the loan before term (every 80% of premiums paid in advance eliminates 11 instalments (direct savings)
Wish me luck 4. Mortgage has inbuilt life insurance, if you croak then Mr/Mrs Kiwaru and kids are assured of a fully paid house....
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Rank: Veteran Joined: 10/9/2006 Posts: 1,502
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I will hesitate committing myself to an apartment mortgage. work to prosper
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Rank: Member Joined: 5/14/2014 Posts: 289 Location: nairobi
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being in debt for 25 years is slavery.not good for health I find satisfaction in owning great business,not trading them
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Rank: Elder Joined: 6/23/2009 Posts: 14,318 Location: nairobi
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Tokyo wrote:I will hesitate committing myself to an apartment mortgage. 48% of new houses being built in Kenya are now apartments. So long as u dont buy above 1st floor, its fine.. So that as you age u may still make it up those flights!! COOP, IMH, KEGN, KQ, MTNU
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Rank: Member Joined: 10/19/2009 Posts: 671 Location: Nairobi
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Othelo wrote:kiwaru wrote:Just paid the first instalment into a 25 year old home loan (aka slow death). My reasons for going into mortgage:
1. Peace of mind... since my family must live somewhere, it had better be in MY HOUSE
2. Expense savings: initially an oxy-moron since 96% of the premiums go to interest payment. But the mortgage is 150% of the rent for that hse after raising 15%.
In my previous house I noticed that rent had doubled in about 5 years. So I am thinking long term here
3. Capital appreciation: with the estimated 12% annual capital appreciation, I am building equity that am living in, and I can tap into for whatever
Disclaimer: I am praying to God and i have every intention of clearing the loan before term (every 80% of premiums paid in advance eliminates 11 instalments (direct savings)
Wish me luck There is the catch. Manage that well and you will be home and dry! you also need to try hard to bring it to over 50% of repayment going towards paying the loan principal not interest! Question: Do Banks usually allow "irregular" topups to your monthly payments, so that more principal is returned earlier? Say, month 1 you pay as usual. Then month two, you pay twice ur monthly figure etc etc? Or only lump sums can be used to reduce Principal figure. I know Saccos can be flexible. But Banks?
Life is joy, death is peace, but the transition is very difficult.
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Is Taking a Mortgage the WORST Decision Ever??
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