Archive for May, 2009
May 18th, 2009 | 
Author: Wasn’t it nice when you signed up
lender said, “Why don’t we just go ahead and add your property taxes and insurance to the bill every month, and we’ll pay it all for you?” Sure it was nice. For them.
Property taxes and insurance both come due twice a year, but by saving yourself the hassle of writing four simple checks a year, you’re paying them every single month—and losing out on the interest the money could be earning. It is not farfetched to think you could have earned $240 a year on the interest from your insurance and property taxes. Let’s say you did. Over forty years (which is about how long people really pay mortgages, by buying a house, selling it, buying another house, and starting the mortgage process all over again) at 8 percent, you could be paying your bank $62,173 in lost interest and earnings just to be your personal secretary and write those four checks for you. Over thirty years you could have lost out on $20,187; over fifteen years, $6,517. And if you’re carrying two mortgages, your savings will more than double.
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