Pete Kirby: ‘My work as a loan agent has taught me one thing very clearly: people should very rarely pay points to obtain a mortgage. The reason is that ANY refinance ends the first mortgage and the points paid are then not doing their job anymore. I have clients that have refinanced five times in two years. They never knew ahead of time when refinancing would be feasible. Each refinance was done with no points and they ratcheted their interest rate down each time. By now, interest rates may not fall much further; but then again, who really knows?’

☞ Not I. But as we enter a new era of (Republican) borrow-and-spend deficits, it’s quite likely that the long slide in long-term interest rates is more or less over. So I’d be surprised if you have many clients refinancing five times in the next few years. Though, as you say, you never know.


Rob Zelms: ‘You wrote that you should rent if you plan on owning a house for 2 years or less. This is somewhat confusing considering most people in today’s real estate market are able to make a significant tax-free profit when they sell a property after only 2 years. I’m on the verge of selling my second home in two and a half years and I can assure you it has been the best financial decision I’ve ever made. Not to boast, but I cleared 50k on my first home and will clear in excess of 100k on my next. All things being equal, you should always own if you’re going to live there for at least a year. That way, your only tax is the 20% capital gain.’

☞ Hey, so long as home prices jump $50,000 and $100,000 a year, you are absolutely right. But what about going forward? Can homes appreciate at, say, 10% a year forever? I think not, unless incomes are growing at 10% a year also, which they tend not to do. Might home prices even fall back a little if long-term interest rates should rise and mortgages become harder to carry?


Earlier this month I mentioned that Charles had put up with me for eight years now. Several of you sent kind words – thanks – including Paul Ward, who went on to write: ‘My partner David and I have been together now for 28 years as of last February and are proud to have contributed to the ideals of love, family, nurturing and Christ’s admonition to ‘love one another.’ We live quiet, productive lives, pay our taxes and expect only to be allowed to live our lives without interference.’

☞ Equal economic benefits might be something to expect, too. If one of you goes before the other, why shouldn’t the survivor inherit tax-free, just as with any other committed couple? And why shouldn’t he be eligible for Social Security survivor benefits? But 28 years – hats off to you both, and here’s to 28 more.


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