Ask tommy2 about Real Estate

[casey_brick]

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Why pay interest when you have the funds?

FWIW, I personally think that with $250K in liquid assets you can diversify your holdings. Buy an investment property, invest, etc. Not sure why you feel the need to pay cash for a house. But if you're itching to, don't pay interest when you have the cash, unless you can do something that yields better returns on the difference (which remodeling is not one of).

Also, be aware that in most cases remodeling has negative returns. This means you should only do it for your family's happiness and enjoyment, not as any sort of investment. In CA I believe the only profitable remodels are bathrooms and kitchens. Off the top of my head the return is about 8% on average.

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Maybe a little more background, this is $250k we have save just for a house. I am a Marine and we have lived on Base or in Military housing for years. I'd guess more to the heart of what I'm asking is the tax write off better for interst on a mortage or on a home equity loan. This is a home we plan to live in for a long time so money spent on a remodel is not for investment.

[JasonK]

Home equity loans typically have a higher interest rate than first mortgages.

[scotchnrocks]

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Home equity loans typically have a higher interest rate than first mortgages.

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yep...I don't know what is standard, but the equity line I have access to is about 2.5% higher than my mortgage