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September 2012 Moms
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tackling dept (mortgage)

jenmbottjenmbott member
in September 2012 Moms
A lot of you talked about living frugally in order to tackle debt yet still have a mortgage or car payment.  But is anyone attempting to pay off their mortgage?  I am dying to pay off the mortgage. I  already pay off my credit cards before I get the statements so I know that there is a $0 balance.

On top of paying the mortgage each month we are putting an extra $250 towards the principal balance.  I'm not sure if this is the most fiscally responsible thing to do as I could be taking the $250 and investing it into a mutual find that earns ~8%.  

We have already refinanced the mortgage from a 6.25%, 30 year loan down to a 3%, 15 year loan and are only paying and extra $30/month than before. I know that we won't be living in our house long enough to pay it off but we are gaining equity.  Logistically we will move in 4 - 5 years to a bigger, more expensive house and I am hoping that with the equity we are gaining that our monthly payment is similar to what it is now.  

extra info: original cost of house in 2008 was 128K, taxes are $3,700/year, currently owe 94K and with our current repayment schedule we could pay it off in 11 years.  Other money and math nerds talk to me.  What smart money moves are you making?  Do you want to be 100% debt free and how are you doing that?

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Re: tackling dept (mortgage)

  • hmp1hmp1 member
    We have a 15 year loan so we hopefully will not have a house payment by the time the boys start college. We also pay an extra payment every year with part of DH's end of year bonus. I'm not in a rush to pay off the house but I don't want to spend a ton in interest either. We might stay in this house until the boys go off to school, or we might move just before James starts middle school. But we have no plans to move before that.



    James Sawyer 12.3.10
    Leo Richard 9.20.12 
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  • hmp1hmp1 member
    edited August 2013
    Also, we have a few things that are interest free so I am in no hurry to pay those off until the interest free term is up. I would rather be making interest on my money and pay later. That is also how we handle our taxes/withholdings. We pay every year instead of getting money back. I try to get it close to even but would still rather pay than get back.

    James Sawyer 12.3.10
    Leo Richard 9.20.12 
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  • BPerBPer member
    We're putting all extra money in savings to put towards the construction of our house, so that our mortgage will be significantly less, plus we have about 80k worth of equity in our home currently. Other than my student loans, and a few low credit card balances, we don't have any other debt.
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  • ShopperKristiShopperKristi member
    In my opinion it doesn't make sense to pay off your mortgage when it is at 3% and you could be earning 8% on your mutual funds. Do you have a financial planner? I worked in banking for 10 years and most of the guys I know would have said take the higher return, secure your future, and when you are ready to retire, if you have more than enough, pay off your mortgage at that time. You're losing a net of 5% by throwing money at your mortgage. Now, if your goal is mainly to build equity so your next house payment is lower that is a completely different. You could see if there are any types of high yield savings accounts that will get you a higher return than 3% but that might be tougher to find so maybe paying it down is right for you in this particular scenario. Being debt free is an awesome goal but don't be two caught up in it that you actually wind up making poor decisions!
    Lilypie - Personal pictureLilypie Premature Baby tickers
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  • BillyMollyEmmyBillyMollyEmmy member
    I have a student loan, and a mortgage and no other debt. I am close to paying off the student loan and once we hit our five year mark with our mortgage I will consider upping our payments. We pay weekly, so that helps a tiny bit to pay it off faster. But honestly, while I enjoy having money in the bank, I also try to not worry too much about paying off my mortgage super fast. I want to, but I also feel like stretching ourselves thin to do so doesn't make sense either.
    We don't have cable/satellite, we have one car, and we live an hour from the city which makes shopping a little harder, so I don't really enjoy retail therapy sessions that much... and I would say that I cloth diaper, but that doesn't save me anything since I have an addiction to fluff lol
    Me: 27 DH: 28
    Diagnosis: PCOS, irregular cycles, old lady eggs. DH is fine.
    Started TTC in January 2010. BFP December 25, 2011 between IF appts. 
    DD born August 31, 2012
    Began TTC again in Jan. 2013. 
    Four rounds of Clomid - BFN
    Fifth round of Clomid September/Oct - cancelled
    HSG scheduled for Oct. 30 - Tubes all clear
    December: Round one of Femara  - BFN
    Round two - ? 

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