Former No. 1 draft pick and current unemployment rate contributor JaMarcus Russell is facing foreclosure on his Oakland home that is worth an estimated $2.4 million. According to TMZ, the codeine enthusiast is behind on his mortgage payments to the tune of $195,512.05 and he has three months to pay up or his home will be auctioned. I will bid on this house, but only if his fur coats are included.
Here’s what I don’t get, and I openly ask any of our millionaire readers to correct my ignorance – JaMarcus signed a deal worth $61 million when the Oakland Raiders made him the top pick in the 2007 NFL draft. $32 million of that deal was guaranteed, so how the hell does he even have a house payment for a $2.4 million home? Far be it for me to criticize the wealthy but as someone who appreciates not being homeless or having my credit destroyed, I just think it makes sense to pay the whole thing off up front.
But hey, what am I worried about? I’m sure the Washington Redskins will take care of his financial woes soon enough.
Side Thought: New JaMarcus nickname – Fail Whale. I think it has legs.
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Basically, if you have millions of dollars to invest, you can find relatively safe deals for that money that will earn you more than the interest you pay on a house. So instead of paying it off, it makes better sense to use the money to make that interest and just pay a mortgage.
Of course, that’s only good if you pick good investments and don’t piss your cash away.
Sure, he’s losing his home, but what of the drank? WHAT OF THE DRANK???
I don’t know how high the cap is on mortgage interest deduction, but what Splint says has some legs: he can plow the cash (he would’ve otherwise paid for the house) into investments that make more than low-low-low mortgage interest. Tax-free muni bonds can beat mortgage interest, if you get the right loan.
Then again, if you do that you’re tying up two chunks of money–the stuff you owe, and the stuff you invest–rather than just paying for the house free & clear. But, if you have a ton of other cash, you don’t worry that you’re overcommitting yourself.
Bottom line, though, is any financial advisor/accountant/lawyer who tells a 22 year-old with
Right, there’s also something to be said about security, e.g. “No matter what happens, I’ll never have to worry about a house payment.”
I can’t read the rest of your comment but I think I’d agree. He’s a 22 year old htat never had that kind of money. Buy him some security before you start the financial wheeling and dealings. In other words, pay off the house and get him some long-term annuities.
Umm, he’s black. Which means once the first cheque came in, he figured he’d get those same checks every week for the rest of his life.
This is why the Owners don’t want to give the players any more money. They just piss it away. Might as well keep it and do something good with it
‘Cause “he’s black”? WTF does that have to do with anything?
weird how my post got cut off.
I was saying something along the lines of how any agent/adviser, working with a suddenly multi-multi-millionaire 22 year-old who can’t even spell “Wonderlic,” shouldn’t have gotten Russell into any loans. Pay cash for everything. Don’t try to be fancy; don’t try to invest $ that would be better off paying for the house in full.
KISS.
A picture says a thousand words. Airhead in Fur Coat.