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From: ed@mtxinu.UUCP (Ed Gould)
Newsgroups: net.consumers
Subject: Re: mortgage question
Message-ID: <344@mtxinu.UUCP>
Date: Sun, 14-Apr-85 02:55:45 EST
Article-I.D.: mtxinu.344
Posted: Sun Apr 14 02:55:45 1985
Date-Received: Fri, 19-Apr-85 00:14:33 EST
References: <188@mhuxn.UUCP>
Organization: mt Xinu, Berkeley, CA
Lines: 26

> I am shopping for my first mortgage and would appreciate
> all the advice readers of this group can offer.
> 
> One plan that is particularly interesting is something called
> "Graduated Equity Mortgage."

All of the advice I've heard (except from real estate brokers,
whom I don't trust much) says to chose the lowest-numbered
mortgage you can get from this list:

	1.  Fixed rate
	2.  Variable rate (capped is better than uncapped;
	    I think everyone is offering capped ones these days)
	3.  Negative amortization (same as "GEM" above)

The reason given is that the real cost of the loan will be lower.

As for paying off the loan faster, which is usually a good idea
if you can afford it, just pay more (by $50 - $100 or so per month)
than the minimum payment.  Be sure, however, to designate the extra
to go towards principal, or the lender will probably apply it to
interest!

-- 
Ed Gould		    mt Xinu, 739 Allston Way, Berkeley, CA  94710  USA
{ucbvax,decvax}!mtxinu!ed   +1 415 644 0146