Getting a mortgage on a paid-for house?

[SeanPizzle]

How hard is it to get a mortgage (80/20) on a paid for house or property? I would be interested in converting the equity to liquidity for some investments in portable precious metals.

I am not saying the sky is falling but getting out of Dodge might be necessary in the next two years.

[RANDY P]

Cash out to 100%
- unlikely.

maybe 70% these days... don't expect much more tho.

[stomachmonkey]

I think that would be a HELOC and not a mortgage, kinda same same but then again not.

[on2wheels52]

While I'll admit to being a fan of "portable precious metals", I'm also rather fond of having a paid-for house.
Jim

[TheMentat]

Originally Posted by stomachmonkey

I think that would be a HELOC and not a mortgage, kinda same same but then again not.

I think both involve a mortgage... its just that a HELOC doesn't have an ammortization schedule.

[TheMentat]

Originally Posted by SeanPizzle

How hard is it to get a mortgage (80/20) on a paid for house or property? I would be interested in converting the equity to liquidity for some investments in portable precious metals.

I am not saying the sky is falling but getting out of Dodge might be necessary in the next two years.

If you truly believe that the US dollar us going to crater, you'd be crazy NOT to have a mortgage with obligations denominated in US dollars.

[Porsche-O-Phile]

Exactly - this was a consideration when I bought. I fully expect to be able to pay off my house in the next few years with dollars worth a fraction of what they were when I signed papers.

[HardDrive]

Sean, I don't think putting all your money into precious metals is a great idea. It can be part of an array of hedges against the decline of the dollar, but I certainly wouldn't want to be walking around with $200,000 in gold at a time of crisis. Criminals, cops, customs officials....there are a lot of ways to quickly lose your nest egg.

[porsche4life]

Tin foil hats really aren't precious metals....

[SeanPizzle]

Originally Posted by HardDrive

Sean, I don't think putting all your money into precious metals is a great idea. It can be part of an array of hedges against the decline of the dollar, but I certainly wouldn't want to be walking around with $200,000 in gold at a time of crisis. Criminals, cops, customs officials....there are a lot of ways to quickly lose your nest egg.

We were very proud to pay off our house in 7 years when we were in our early 40's. Now I look at this asset that could not be turned liquid in case of financial Armageddon and wonder if that was a good idea. Nobody will be buying houses once SHTF either because of federal insolvency or when the State of CA or Municipal $550B debt/unfunded retirement liability in the finally sinks us. I think it is a foregone conclusion and not a matter of if but when this will happen.

So I started to do some calculations. My house equity converted to gold would equal about 10 kilos of gold. Each kilo bar is roughly 3.5" x 1.6" x .6". I could strap 10 of these to my body when the time came to get out of dodge with my family. The question is where would I go. Commercial air travel would be out of the question as there is no way to make it through security with 10 kilos of metal strapped to your person. My sister is an exec at netjets and I could hire a very expensive charter jet without going through security.

New Zealand would be high on my list of target countries. They require $1.5M in investment monies to immigrate as of now. If we liquidate everything we are there.

Yes, I was up late thinking this stuff up. Yes, it is sad that our country has gotten to the place where we fully expect financial collapse.

I will stop before I parf it up.

[mikesride]

almost anybody will give you 80% value with no issues. Some will call it a mortgage some will call it a heloc. Shop around, fyi a heloc will not have any penalties for early pay out. I have done this in the past when I thought I wanted to be a real-estate mogul!!!!

[Chocaholic]

Or just sell your house and move before the martians arrive. If you're so sure that Armageddon is coming, why wait for it???

Get some sleep.

[McLovin]

Sure, you can get a loan. It's called a "cash out" loan (instead of a "refi").

You can get 80%, but you'd likely find a better interest rate on a 75% loan.

Also, kind of surprisingly, the interest rate on a "cash out" loan is usually higher than on a refi. It's a little surprising to me, because someone who has had the responsibility and discipline to pay off a house seems like a good person to loan to.

But, they view it as a semi-negative. Because (1) you don't have a recent history of making mortgage payments, and (2) they are never really sure what you are going to do with the money. You very well might make ill-advised investments with it (like buying bad rental properties) and end up bankrupt. Or, the fact that you "need" to now convert the equity in your house to cash might signal that you anticipate upcoming financial stress.

When they are simply refi-ing an existing loan to a lower rate, they know there aren't any major changes to your financial situation or plans.

[Gogar]

Originally Posted by SeanPizzle

New Zealand would be high on my list of target countries. They require $1.5M in investment monies to immigrate as of now. If we liquidate everything we are there.

1.5M? BAH! St. Kitts will only cost you $400K. Trade those sheep for monkeys!

[nostatic]

Originally Posted by SeanPizzle

New Zealand would be high on my list of target countries. They require $1.5M in investment monies to immigrate as of now. If we liquidate everything we are there.

.

Last time I checked (about a year ago), there is a point system and if you have skills they need, you don't need to bring in a bunch of cash. You do have to get in before age 55 though...

[dmcummins]

I recently got a loan on my then, paid for house. I ended up with a 30yr loan @ 3.75%. The mortgage company wanted more information than I liked. They also wanted to know what I wanted the money for. My banker said Hookers and blow was not what they were looking for.

They also had questions on some deposits I made into a checking account. I would think deposits would be a good thing. I didn't feel it was any of their business. They even questioned the appraisal, that they set up and I paid for. But in the end I gave them what they wanted and it took about 3 weeks.

The difference here in a mortgage and a HELOC is the HELOC is adjustable, I wanted to lock in these low rates.

[wdfifteen]

Originally Posted by SeanPizzle

I could strap 10 of these to my body when the time came to get out of dodge with my family. The question is where would I go.

You're smart enough to think about cashing out of your house, but you're not smart enough to know where you're going? I call shenanigans. This post is a political statement disguised as a question just to keep it out of PARF.

[ckelly78z]

I paid off my 10 acre farm earlier this year and won't even consider doing the cashout and starting over at this point. We are using the $1000 a month (former mortgage payment) to invest additionally for retirement, buying and fixing things that that have needed it for awhile, and building our checking and savings. I keep several thousand $$, guns/ammo, and food supplies at home for an emergency, but I can't imagine bugging out to some unknown place with my life savings on my belt.....so many bad scenarios !

[speeder]

I'm kind of surprised that the economy has not completely collapsed and dollar become worthless already. The nutters have been saying that it's going to happen since about 1957.

[SeanPizzle]

Originally Posted by speeder

I'm kind of surprised that the economy has not completely collapsed and dollar become worthless already. The nutters have been saying that it's going to happen since about 1957.

In 1957 the nutters weren't staring at this: