Financing your swimming pool

[GTakacs]

Even with a good rate and financed for only 5 years, you will be paying the bank at least $5,000 in interest on a $25,000 loan.

Actually at 6% for 5 years on $25k you'd pay just under $4k in interest.

[Jeffski]

Or you lose your job, can't pay the loan, and lose your house too.

I am not against borrowing money, but when you do make sure you can pay all your bills even on your worst day.

[GTakacs]

Or you lose your job, can't pay the loan, and lose your house too.

I am not against borrowing money, but when you do make sure you can pay all your bills even on your worst day.

Sure, I guess. But to be honest I doubt that a bank on a 3rd mortgage would rather foreclose your house than give you a bit of time off to regroup and find another job. By the time they sell your house and pay off your first and second mortgage, little if anything is left for the 3rd mortgagor.

[bobyoe]

I just would be sooooo nervous to finance 125% of my home's value. Just me maybe.
Boby

[GTakacs]

I just would be sooooo nervous to finance 125% of my home's value. Just me maybe.
Boby

Why? It actually gives you a better chance of holding onto the house if you can't make the payments. The bank that financed the 3rd lien that is 25% over the value would get nothing if they foreclosed, so they'd be more inclined to let you miss a few payments and make it up later than sell off your house.

I'm not condoning maxing out credit cards or foreclosing on houses, but I think borrowing more on a house than it's worth is just fine. What is the worst that can happen?