Are there any disadvantages of Progress Draw Mortgage?
Presumably, the inverse of the advantages? You are guaranteed the interest rate that is written on your mortgage commitment as long as the first draw happens before the rate hold expiry date (typically 120 days from application date). In most cases, it takes at least 6 months or more to build a home from the ground up. That means that you are taking a chance at what the interest rates and qualifying criteria will be several months down the road. You can normally only lock in 120 days prior to possession with a 'Completion Mortgage'. Lenders are constantly changing their guidelines and rates are predicted to increase over the coming months. That means you are much better to obtain draw mortgage financing to avoid any of these uncertainties. You will know that you have your financing in place right away before construction even starts. This is a huge peace of mind so you can relax and get ready for the big move. So thus, if interest rates are lower 6 months or a year from now, that'd be the disadvantage -- a longer lock-in period.
"&gt;No they pay less  Except they don't.  Just look at the tax brackets.  It's progressive.  The more you make, the higher your tax rate.  10% $0 to $9,275 $0 to $13,250  15% $9,276 to $37,650 $13,251 to $50,400  25% $37,651 to $91,150   28% $91,151 to $190,150   33% $190,151 to $413,350   35% $413,351 to $415,050   39.6% $415,051 or more   See how the % increases with increased income?  That's called a progressive tax system.  Can you say ""progressive""?" "Maybe, in that the government gets interest on the money it takes in, and has to pay interest on the money it spends or has agreed to spend (pensions, etc.). So depending on which interest rate is higher, the disadvantage shifts a little.  It's also not a question of ""deeming"" things, but a tax credit would be more like taking a cut in pay rather than spending more money. Thinking of it as ""spending tax money"" should only be a way of helping to show that it makes this disadvantage." "Don't mind the percentages. They are highly misleading. First, ""saving"" is making available for future use. It might be ""hoarding"", ""investing"" or a combination thereof. It might be for a specific use (a car, a college education, retirement, etc.), or for a non-specific use (for an emergency, for when you decide to spend some of those savings, or just for lack of a compelling use as of the moment). In first case, whatever you save should be available by the date you intend to use it. In second case, it might be prudent to have savings (and investments, see below) of various liquidity (cash you have at hand, bank account you can draw next day, mutual fund account you can draw in a month, maybe something you can only cash in a year etc.). You will see that the actual percentages you ""save"" fluctuate enormously throughout your life, varying with the progress of your career, changes of marital status and family cmposition, etc., etc. What you should really do is to come up with a rough plan of how you expect, from right now and to the end of your life at whatever age, have enough money for whatever level of comfort you plan for each period of your life, allowing for some specified level of perturbations. Then you just execute that plan or change it as you go." "Computer advances increasingly let manufacturers customize orders and ship goods faster. In the new world, making products in faraway low-wage countries like China can be a disadvantage: It can take too long - weeks, months - to ship finished products to the United States.  ""This is about customer proximity,"" said Michael Mandel, chief economic strategist at the Progressive Policy Institute. ""You develop a sustainable and durable advantage against overseas competition.""  Mandel said the growing trend would have emerged regardless of who occupied the White House. Still, President Donald Trump took the opportunity to take some credit Wednesday for the Foxconn announcement, saying it ""definitely"" happened because of his election and his pursuit of tax and regulatory cuts.   [source] (http://hosted.ap.org/dynamic/stories/U/US_BC_US_AMAZON_AND_FOXCONN_SPEED_TO_CUSTOMERS?SITE=AP&amp;SECTION=HOME&amp;TEMPLATE=DEFAULT&amp;CTIME=2017-07-27-03-16-36)" My card keeps a separate 'cash advance' limit, that's lower than the regular rate. I believe balance transfers also trigger that limit and (much higher) interest rate. Assumptions 1 & 2 are correct. Plus you will improve on credit score. The only disadvantage is if you get lax about it and overspend beyond your limit ... Plus a small risk of fraud of card transactions ... Unless you have an actual hardship (bankruptcy or other emergency), you will be better off leaving that money alone. This excellent answer, gives more than enough reasons why a withdrawal or loan is not recommended.  I would love some advice because I need to know if I should contribute more into my 401k or less. If your priority to purchase is high enough, it may be worth considering stopping 401k contributions for a short time to help pile up a down payment.  I also encourage you to consider that if you cannot pool the money from non-retirement sources, then you cannot afford that much house at this time. This might mean looking for cheaper houses or delaying purchase for a number of years. Paying weekly to be able to have maneuver room under your credit limit is a way to handle low credit limits. Doing it to boost your credit score when you have no immediate need for a loan is wasting energy.  A few months in advance of buying a car or house, you can start to worry about your utilization rate. When you apply for the loan they will pull your credit file, and that will lock in your utilization rates. Then make sure that you pay the balance quickly, and if you need to make a big purchase pay the bill before the account closes for the month. Keep in mind that if you pay the balance every month the highest utilization rate will occur the day the payment is due. This is because it not only has all the purchases from the previous bill, but all the purchases you have made since that bill closed. For example if you have a credit limit of 10K and you spend 2K a month on the credit card, on the day the payment is due it is not unusual to see the total owed to be above 3K. If they pulled your file on that day, your utilization rate would appear to be above 30%.