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Thursday, June 13, 2013

Free Money Finance - Mortgage Payment Options


Free Money Finance

Posted: 13 May 2013 05:18 AM PDT
Here's an email I recently received from a reader:
My wife and I are buying our first home and our mortgage payment is going to end up being right around $850 a month give or take a few dollars. This is under our budget of $1000 per month that we were are willing to spend. We will only be putting 10% down so we will have some mortgage insurance as a part of that payment. We currently have no debt other debt outside our monthly credit card balance that we pay off in full every month. My question is this:

Would you recommend that...
    we pay our full budgeted amount of $1000 per month towards our mortgage?
OR
    we make the minimum payment of $850 and then invest the $150 we have left over in a mutual fund?
OR
    is there another option out there besides either of these two I should be considering?
It may also be helpful to know that my brother just started with Edward Jones so any investment I make through him  into a mutual fund I do not have to pay the sales charge that is normally 5.75%.
What's your advice for him?
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