Top Mortgage Mistakes Clients Make

LOS ANGELES It's clear that leverage was one of the main culprits of the financial meltdown, but what other factors were at play? For advisors, allowing clients to take too much leverage on mortgages was irresponsible and immoral, according to financial planners at the Milken Institute's conference in Los Angeles.

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Comments (2)
Some good points, especially the one about choosing the right type of mortgage. Not so sure if it matters too much whether you are better off if your property loses 50 percent and you don't have a mortgage viz a vis having 100 percent equity.
Posted by Consumer A | Tuesday, May 06 2014 at 12:22PM ET
When clients ask if they should pay off the mortgage early, my reply and calculations would include:

1. Which "bucket" of money is this coming from?
2. Will you have enough remaining in the emergency fund?
3. How long do you plan on staying in the home?
4. How much interest will you be saving?
5. What is your home's value as compared to the neighborhood?
6. Why do you really want to pay off the house early?

Run the numbers and then decide. Your financial plan is unique, just like you are.
Posted by MICHELE N | Wednesday, May 07 2014 at 7:19AM ET
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