You have two loans.one current home and the second is a loan land, you must be extra payments for first?

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If you have more money to make additional payments, you should make additional payments (plan to build a house in the country over the next 1-5 years) on your existing mortgage or you additional payments to your land loan. If a loan interest rate higher than 1% is one you should try to pay more quickly?

6 Comments
  1. Reply
    Amanda H
    April 29, 2011 at 11:55 pm

    I would go with the higher interest one if it were me.

  2. Reply
    zippythejessi
    April 30, 2011 at 12:15 am

    Whichever one has the higher interest rate and/or the largest balance.

  3. Reply
    Wendy S
    April 30, 2011 at 1:10 am

    I’d make the extra payments on your current home loan, then ASAP refinance the land loan into a Home Equity Loan or Line of Credit so you can deduct the interest.

  4. Reply
    Jay
    April 30, 2011 at 1:13 am

    Given your timespan, why are you looking to pay off more of the home loan? There’s little to gain.

    While we’re at it, why would you want to pay off extra principal on the land loan? Knowing what you expect to gain from doing that might shed some light on this.

    I’d suggest that you save the extra cash to go towards construction of the new home. You can take out a smaller home construction loan.

    Second to that, I’d put the money towards the land loan, since I’m expecting that you plan on living them for many years.

  5. Reply
    grizzliesgurl
    April 30, 2011 at 1:25 am

    I would suggest that you pay on the higher interest loan it would certainly save you the most money in the long run.

  6. Reply
    Zandelia
    April 30, 2011 at 2:21 am

    Pay the one with higher interest. But don’t make extra payments…just pay additional principal (no extra interest)

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