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Originally Posted by Bill Lundberg
Either you're rate is wrong or your wrong. If you amortize $220,000 at 5.5% for 30 years your Principle and Interest payment is $1249.14. It is possible that your total payment is $1500.
Edit to add: You may have an interest only loan. Which means your balance isn't going down with each payment.
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I was a little off, but not by much.
$216,900 at 5.25% for $1197 a month for principle and interest.
Not only does owning your own home allow you to invest in your own property, it is great during tax season. Last year I was in the 50-60 salary range, with 3 kids. Throughout the year I paid around $3500 in federal taxes. After deducting interest payments, child tax credit, and 401K I got back $4500, nearly $1000 more than I paid into the system. Granted, the three kids helped out that number but the $13k+ that I paid in interest certainly didn't hurt things.
And don't fool yourself, you are making a payment on interest regardless of whether you own or rent. Renters pay the landlord interest, owners pay your own.