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Should i payoff loans even if i have enough to pay for it or not?

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    Should i payoff loans even if i have enough to pay for it or not?

    I have mortgage of $250K @3.75% for remaining 24 years term (actual 16 years) and car loan of $43K @4% for 6 years term. I just recently sold some of the stocks and bank saving of total $110K (majority of case $70K from selling stock recently that I had from 2012) I still have $70K and another 160K worth of stocks in 2nd account that I am considering to sell. Should I pay off my loans by selling stocks i have or invest in other stocks or 2nd mortgage or go on safer route with mutual funds etc? Also should i consider refinance my loan(s) to maybe 10 year term @~3%?

    #2
    If you sold these stocks at a gain and are not in the 0% capital gains tax bracket make sure you have enough to cover the taxes owed. .... .. Which has a higher monthly payment - mortgage (P&I only) or the car loan? ... .. Depending on above I would payoff that awfully high car loan (balance and rate not to mention a 6 year term).

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      #3
      There isn't nearly enough information here to answer your questions.

      How old are you? How much do you earn? Do you have a fully funded emergency fund? How much are you saving for retirement?

      Tell us more about the stock you have. What was the intended purpose for that money? Why are you considering selling it now?

      You also mention a 2nd mortgage. Do you mean taking out a loan against your existing property or are you thinking about buying another property? If the latter, would that be for personal use or as a rental?
      Steve

      * Despite the high cost of living, it remains very popular.
      * Why should I pay for my daughter's education when she already knows everything?
      * There are no shortcuts to anywhere worth going.

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        #4
        I don't know how this thread even got started. I can't start a new thread...... Unless that got fixed?
        Brian

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          #5
          Here are some missing information:
          I am 35 years old. I got married beginning of this year.
          Wife is currently not working until first half of next year. I make $120K
          I do have about 25K in emergency fund
          I have about 50K in 401K. Planning to increase this for sure but not in short term.
          I bought some long term stocks that are in 10-15% or higher growth and I have AT&T/BoA stocks for Dividend.
          I am considering to sell stocks because it is stagnate not gaining value and
          The stocks that I have sold are based on ESPP so gain is not so large but Yes i need to keep some money aside for Tax.
          I do not pay PMI for for mortgage
          I was thinking to put this money toward mortgage simply because it is higher dollar over longer time instead of my car loan.
          In order to also grow future income on real estate, i am considering buying primary home and rent current one. (For now, it's not possible due to single income)
          If I do find properly that is right price, i would consider it but not sure when it will happen..

          Comment


            #6
            Originally posted by webeq View Post
            Here are some missing information:
            I am 35 years old. I got married beginning of this year.
            Wife is currently not working until first half of next year. I make $120K
            Just curious why she isn't working. Is she in school or otherwise occupied? Does she already have a job lined up? If so, what will her income be?

            I do have about 25K in emergency fund
            How many months of expenses does that represent?
            I have about 50K in 401K. Planning to increase this for sure but not in short term.
            Are you not currently contributing? If so, why not? There is no more valuable resource in your investing life than time. The longer you wait to invest, the less benefit you get.
            I bought some long term stocks that are in 10-15% or higher growth and I have AT&T/BoA stocks for Dividend.
            I am considering to sell stocks because it is stagnate not gaining value
            You bought "long term stocks" but are selling because of short term results. That makes no sense.
            Why at 35 are you concerned with dividends and income-producing stocks rather than growth?
            And why are you investing in stocks in a taxable account rather than in your 401k?

            I was thinking to put this money toward mortgage simply because it is higher dollar over longer time instead of my car loan.
            It doesn't matter what the principal is. It matters what the interest rate is. The car loan is costing you more for every dollar borrowed than the house, especially after you factor in the tax deduction.


            Steve

            * Despite the high cost of living, it remains very popular.
            * Why should I pay for my daughter's education when she already knows everything?
            * There are no shortcuts to anywhere worth going.

            Comment


              #7
              depends. are you planning on moving? You might be better off keeping the cash to put down on an offer on another house. Pay off the car loan.
              LivingAlmostLarge Blog

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                #8
                You could do both and pay some more to investments and some to mortgage.

                I know in the various estimated returns, people will show you ten ways one COULD come out better then other ways. I think of prepaying my Mortgage as Guaranteed return.
                Everywhere (not sure if they all are Chicken little the sky is falling) people are talking about possible downturns in the market. many are buying high at the moment and may not like a correction.

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