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Personal Finance (Not Investing) • Home purchase cash vs mortgage

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Hello all,

Was hoping for some sanity check. We are planning and hoping to buy a house here shortly. If all goes well we will net some 400k in proceeds from my current house sale. We will need 450k extra to purchase our future house in cash.

My thought was that we use 150k from our over 10 year old iBonds and bring another 150 from selling my muni bonds which really just continue to suffer. We are seeing a 8k loss but I am hopeful that I can use that loss to offset my taxes next year. Here I do have a question. Can we only offset capital gain or can we offset dividends or interest received. We don't ever sell our securities (except this time) so won't have any capital gains to speak off. And finally the last 150 from our savings that are currently earning 5%.

So the two questions are:

1. In this high interest mortgage rate, would it be better to buy in cash and save all that mortgage interest, not to mention closing costs which I was given an estimate for 8-9k just for lender fees
2. Selling under performing munis and taking a loss can that we used to offset dividend or interest or can that loss only offset pure capital gains. I realize it's only up to 3k a year that one can claim.

We are roughly 20 bonds 80 stocks with some cash that I have been saving up. Selling these bonds munis and ibonds will have an impact of that percentage but my thought was I would build that up gradually from not having to pay the mortgage. Hate paying massive lender fees and high rates (6.68%) when I could try to pay in cash. As I am finishing my post, I realize this is just turning into yet another should I pay my mortgage off type question. Sorry about that but would appreciate any thoughts, experiences you could share. Thank you!

Statistics: Posted by AvocadoDeliberator — Mon May 06, 2024 11:28 pm — Replies 0 — Views 33



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