Financing Finance Kubota or Home Equity?

[Alan L.]

Heehaw, when I said "liquid" I meant those of us who have our money tied up in living, not necessarily hard assets.

I wish I had started putting 16% in a 401(k) when I was 24.

 

[heehaw]

oooh, lets not talk about what we wish we had done...that could cause an overload on the internet, much less tractorbynet!!! i've pretty much made it payday to payday all my life, barely sometimes, so i figure i'll do the same the rest of it..
heehaw

 

[Hoosier_Daddy]

GEE, 401K... I did that very well.. About 6 years ago the wife got it.... And then some... So I started over but not with a wife.... It sure looked good before the "D" word.

Just like paying the mortgage down each month for years.

When went for a new Mortgage after the "D" word the banker laughed at me and said "Gee Tom, are you feeling better now that you paid all that extra money all those years on the mortgage?"

I guess I am just blowing off here but my point is: "enjoy your money. If you have debt's, let the kids worry about it. If you croak and don't have any toys, what's the point in today's life". Let them fight over the new tractor and then discover it still has payments".

I know---- off the subject-- but I feel better......... Tom

 

[Anonymous Poster]

One thing I would recommend with Kubota financeing READ the terms. I did'nt closely and thought I could pay off in 6mo.
and incure no intrest or continue to pay at 3.99% WRONG!!
Called Kubota to get payoff at 5mo. found out that my acc.
was set up as a PAYMENT acc. not a 6mo. no intrest or even
a simple intrest acc. What this all meant was that all the money sent was applied to future payments which allowed
them to charge more than 3.99% because I was paying off
early!!! Oh Well they only got me for $178 but if i had waited
any longer it would have got alot worse. Just make shure
you're loan with Kubota is a simple intrest one I got this loan
in feb. and she said they no longer had this type but i would'nt
trust them or what the salesman says READ IT to be shure
I thought these type of loans were outlawed, NOT!!!!

 

[Anonymous Poster]

similar to david's answer. . .since you have "money tied up in the market". . .if it is in a CMA, you can borrow against the money you already have in the market (you want to choose a low interest making account, though) b/c your interest rate will be 2% higher than the interest you are earning. This is called a "secured loan". . .see if your bank can give you some insight (better yet, if you have cash in a "flex account" or a special savings account, this will guarantee you a low interest rate). . .good luck!
ryan

 

[iashkenes]

I realize I am jumping in late here, but I do have something to add. If you use a home equity loan, obviously, you get the interest write off in most cases. You need to think though, would you rather pay for a tractor for 30 years (or whatever the length of you loan is), when you might sell it and trade up in 5, or 10 years? You will still be paying on it, albeit, maybe not a whole heck of a lot when compared to the mortgage on the house itself. I think it would be wiser to add extras to your house that will save you money in the long run - i.e. a better HVAC, one that is more cost effiecient - thus saving you money in the long term.

When I finance a tractor, I have used zero percent interest credit cards. I figure out the term I want to pay for (5 years), and make the payment based on that amoritized schedule. When the zero percent is 2 months away from being over, I then apply for another, transfer the balance, and CLOSE the previous card. The cycle has been going on for almost 3 years now, and I still have not payed any interest on this loan. Also, be leary of zero cards with a balance transfer fee, That fee will add up to signicant 'interest' if you will.

Another option is to look for a loan at a 'farm' friendly bank. Usually, you can get a loan for agricultural equipment for prime + 2 to 4 percent. That is not too bad.

Obviously, it depends on ones financial circumstances, how much you earn each year, and how much debt you feel comfortable carrying. I don't like the idea of putting my house up for collateral against anything but house items (i.e. new HVAC, roof, addition, etc). Just makes ME a bit uneasy.

I have almost 10 years in the mortgage industry, and I have seen way too many people get over thier head in mortgage equity loans, mostly to pay off other debt, and then getting in deeper again, using the credit they paid off with their equity loan. I don't mean to get up on the podium here, I have just seen too many people make some really bad mistakes when it comes to their house.

Good luck on this one,

Ira