I recently found out that Someone who we will call Mr. Investor and that I only know as "an investor friend" of a friend said "Show me someone who is scared of payments and I'll show you someone who doesn't have anything" in reference to my refusal to finance anything, even a house. And, I very much disagree.
I definitely realize that I could, right now, finance a very nice house with a good downpayment. And, that I would be getting somewhere to live, for less than the cost of rent, and, that it would probably end up being worth more than I put in, even after interest. Trust me, it's tempting!
[Long-Winded Rant Incoming]
The reason I will not, is because I value the freedom of having no payments, and truly owning the things I own more than the money / time I could save (or even make) by financing. And, most of all, I absolutely hate everything to do with borrowing money.
In response to Mr. Investors claim "show me someone who is scared of payments and I'll show you someone who doesn't have anything" While I wouldn't characterize myself as being "scared" of payments, but rather as someone who absolutely despises them, I'd say I don't have much, but, what I do is mine. Unlike, maybe, his car, or boat, or house, or other car. While the titles to all those say Mr. Investor on them, there is a section labelled 'lien-holders' and I would say that is where we find who actually owns all the cool toys in his driveway and probably the driveway, too.
If payments are no big deal, and borrowing money is a good way to make investments, I'd ask why he doesn't take a home loan out against the "equity" of "his" home and put it into the stock market since with the 12% annual return he could easily get with his amazing investing abilities would be much greater than the low 4% rate he could get with his magnificent credit score? 12-4 = 8 = infinite money?!?!?!?
I get the impression Mr. investor is really good with math and very bad with money.
I hate the fact that they (people like Mr. investor) have convinced people that they can't buy a house without a credit score or a mortgage and that they need to have a good credit score so they can borrow money at a good rate to improve their credit score so they can borrow more money so they can buy things they don't need to impress people they don't like with money they don't have.
Most of all, I hate when I tell people about my plan to buy / build a house with cash they laugh at me and say that's impossible. Because that's what the greasy banker implied when they were in that hot little room in the back of the bank negotiating the 30 year mortgage on "their" house "the only way to get a better rate than this would be to pay cash!" and then they all laughed at he absurd notion that some "normal people" like them could ever even dream of doing something as crazy as that! Then they walk out through the lobby after closing the deal and wonder why the bank's furniture is nicer than theirs???
This is why I'm frugal. Because I WILL buy / build a house with cash and every time I hear stuff like this It makes we want to do it even more. Just to prove them wrong and show other people what a farce the whole lending / credit industries are.
December 18, 2020 at 11:51PM
