Jewish World Review Feb. 20, 2001 / 27 Shevat, 5761
No hassles bring low return; 'repo' houses
DEAR BRUCE: I recently received $75,000 in cash as a bequest. For the time being, I want to receive a monthly check, keeping the initial sum in place until I can determine what I want to do with it long term. Should I put this money in a money market account or savings account? Obviously I want to receive as much as I can and don't want to be hassled for just keeping my money in there for a certain period of time. What would be the approximate percentage that I can expect to receive? -- T.C., via e-mail
DEAR T.C.: When you set conditions that you want safety and yet you don't want any hassles, you really limit your horizons. Given those conditions, you might want to consider a money market account that many of the brokerage houses offer. Currently they are paying interest in the area of 5 percent, and you can make a withdrawal simply by writing a check in some instances on a monthly basis. But you must realize that given these conditions, you will have a relatively modest return on your money.
DEAR BRUCE: I have found a house for sale that is a repo. I don't know where to begin purchasing this house. Can it be bought at a discount for what's left on the previous mortgage? What's the best way to go about it? The house is listed at $67,000. -- Mike, Idaho
DEAR MIKE: The last line says it all. The house is listed at $67,000, and I would assume, then, that it's been listed by the lender through an agent of some kind. That this a repo is irrelevant. It's just a question of how much the current owner, probably the lender, is willing to negotiate.
DEAR BRUCE: I want to buy a new car. I figured, why shouldn't I refinance my mortgage to cover the cost of the car? I have $80,000 in equity, so that's not a problem. My current rate is 7-3/4 percent, and I know that I can do better. If I can get it down to 6 percent or 6-3/4 percent, would this be worth my trouble? -- T.W., Denver.
DEAR T.W.: I have no problem with your plan, other than the fact that you should figure out how much you will have to pay on this new mortgage in order to retire the portion spent on the automobile in three years. If you didn't do that, you could be paying for a car for 25 or 30 years, which would be patently absurd. As long as you have the discipline to pay off whatever portion of that loan represents the automobile in three years or less, sounds like a plan. I'm sure you realize the interest will be deductible, which makes it a very good
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