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Thread: Current mortgage and TSP loan

  1. #13

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by burrocrat View Post
    i've used tsp regularly to contribute and get free 5% fake gov future promise money, then take my contributions back out in form of loan, it's like doing the laundry only it pays better. my balance consists mainly of gov match money and i've spent all my contributions on hard tangible things of immediate and future value, copper and lead do not degrade over time with inflation, plus it's fun to appreciate them now. it is a conscious decision not to run the digital fake ones and zeros "money" treadmill. in fact, i am taking a 0% advance on a credit card right now to pay off my last tsp loan so i can borrow more in 60 days which i will use to pay off credit card advance, further my physical and career position with a move, and then buy more stuff and things. i came here naked, hungry, broken and penniless, and that is fully how i intend to leave. life is meant to be lived. chk chk.

    I
    cant tell if you are serious sometime O.o

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  3. #14

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by law87 View Post
    its
    a little bit difficult the mortgage is like 1700 with monthly HOA and everything tax on... it currently being rented out now but the money from renting out the place doesnt cover everything.
    I haven't looked at this in awhile but I seem to remember this has to be a loan to purchase residential property. i.e. property you live in? Have you checked into the requirements?

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  5. #15

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by law87 View Post
    I
    cant tell if you are serious sometime O.o

    i'm dead serious, there is always truth in what i say, although i do deliver it with a dose of humor or sarcasm sometimes, it makes the pill easier to swallow.

    the only not entirely true part of my statement is that i am not really taking a 0% advance on a credit card to pay off current tsp loan. someone else is, then i will pay them back. 1200 free now for payoff, 10k in a couple months to pay off 1200 and back a career skip and jump, then 25% salary signing bonus and pay it all off again, gross 18.5k and net 8.5k on the hop. tsp loan paid back to zero and ready for a rinse and repeat.

    it is easy and cheap, which is probably why i understand the hustle so well. the question i guess then becomes why not just make the move on your own and net the full 18.5k and leave tsp alone? because i don't got no room in the cash flow, i prefer to fly my ass just above the treetops, keeps it real, comin in hot.

    on a related note, if one does not like tsp 2 IFT end-of-day trading handcuffs, why not take out a tsp loan for part of your balance? put it in a schwab or scottrade account, rip real time trades with comparable ETF's, and pay yourself back at 2.5% slowly into the tsp? if you think you can beat 2.5% g-fund/loan payback interest rate on the open market, then why not do it? money was not invented to sit still, it was invented as a vehicle of trade. what you trade for is up to you. this is fundamental stuff.

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  7. #16

    Join Date
    Oct 2010
    Location
    Aiea, Hawaii
    Posts
    812

    Default Re: Current mortgage and TSP loan

    Interest rates will never be this low in our lifetime!
    There are 10 types of people in the world. Those who know binary, and those that don't!!
    Target Retire date: December 2018.

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  9. #17

    Join Date
    Jul 2016
    Location
    Texas
    Posts
    1,734

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by Scout333 View Post
    I haven't looked at this in awhile but I seem to remember this has to be a loan to purchase residential property. i.e. property you live in? Have you checked into the requirements?
    Rules are different for rental properties and the rate will also probably be higher. Homeowner's insurance should go down as you are not covering the contents. I'm glad I refinanced home in WY a year or so before moving which made it possible to make it a rental. Recommend you look at the impact on your taxes before deciding to refinance. With the expenses plus depreciation in a loss position, you may still come out ahead in the long run with your current situation. But in any case, I would still stay away from borrowing from TSP to pay for the rental property.

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  11. #18

    Join Date
    Oct 2010
    Location
    Aiea, Hawaii
    Posts
    812

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by evilanne View Post
    ....But in any case, I would still stay away from borrowing from TSP to pay for the rental property.
    Actually, yes, what EA says! Just refi for 30 yrs, forget the paydown using TSP. Higher deduction, still ultr-low rate, don't lose your potential gain in TSP.
    I took out a TSP loan and regretted it....the lost gains that is!
    TSP loans should be last option, only if there is no way out of it.
    There are 10 types of people in the world. Those who know binary, and those that don't!!
    Target Retire date: December 2018.


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  13. #19

    Join Date
    Aug 2008
    Location
    Pensacola, FL
    Posts
    6,296

    Default Re: Current mortgage and TSP loan

    Refinancing a rental has much higher closing costs/fees than refinancing a primary or second home. And you can't really fudge it and say it's a second home because the underwriter will see that your income tax return and insurance says otherwise.

    I refinanced a second home recently and I had to fight with the underwriter because although it is truly a second home, I had forgotten that it was insured as a rental. They would not budge on the closing costs and fees. In other words, they did not believe that it was not a rental. I finally had to drop that lender and start over with a new lender once I had the insurance corrected.

    You're in a tough spot. Good luck.

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  15. #20

    Join Date
    Jul 2016
    Location
    Texas
    Posts
    1,734

    Default Re: Current mortgage and TSP loan

    If you are getting a large tax refund this year, one option you have to address your current cashflow problem is to change your W-4 to increase the number of exemptions, which will result in less taxes being withheld and more take home income. Recommend you discuss any change with your accountant or tax advisor first.

    On my way out today, I was listening to Dave Ramsey on the radio...he said you should never borrow against your retirement account. In addition to the forgone opportunity cost (difference between greater earnings & current interest rate), if you leave your current job (voluntarily or not) for any reason, the amount of the loan is payable within 60 days or it becomes an early withdrawal, which is considered taxable income + a 10% penalty for early withdrawal.

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  17. #21

    Default Re: Current mortgage and TSP loan

    Quote Originally Posted by evilanne View Post
    it becomes an early withdrawal, which is considered taxable income + a 10% penalty for early withdrawal.
    ha! just couldn't resist, i swear lord i try, it's the bait, tell them to quit layin bait!

    well, i first got laid at 17, so that is about 32 years of "early withdrawal" now. but i'm patient on the front end so it works out even in the mutual benefit end. early withdrawal "don't affect me much". shania said it well, i got the moves and the touch.


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  19. #22

    Default Re: Current mortgage and TSP loan

    I believe he is serious this time. LOL! I agree with him and I this is a serious reply.

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