Author Topic: Mortgage Payoff Club!!  (Read 927245 times)

alcon835

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Re: Mortgage Payoff Club!!
« Reply #2150 on: January 15, 2021, 12:33:43 PM »
Dave is significantly more solid than folks around here give him credit for.

I think he's awesome at connecting with his audience and convincing them to change their behavior for the better.
He gives great advice for getting out of debt, particularly for people who have had problems controlling their spending.

His investing advice seems suspect and designed to funnel people to high fee investments.

Agreed. Eat the meat: Budgeting, Insurance, Getting out of debt, understanding real risk.

Spit out the bones: Anything and everything he says about investing.

AK

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Re: Mortgage Payoff Club!!
« Reply #2151 on: January 16, 2021, 06:17:54 AM »
after listening to Dave Ramsey for a week I decided to pay off my mortgage and did it today.  Purchased residence Jan 2015 so it was a large amount relative to the original principal on the loan.

before I was all about creating positive leverage with debt

Congrats!!

swaneesr

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Re: Mortgage Payoff Club!!
« Reply #2152 on: January 16, 2021, 06:25:33 AM »
after listening to Dave Ramsey for a week I decided to pay off my mortgage and did it today.  Purchased residence Jan 2015 so it was a large amount relative to the original principal on the loan.

before I was all about creating positive leverage with debt
Great job. You truly own every square foot of your home. Every 2x4 and electrical outlet. Must be amazing.

DW and I are working hard to get to the same place.


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AK

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Re: Mortgage Payoff Club!!
« Reply #2153 on: January 16, 2021, 06:50:51 AM »
The mortgage is officially paid. I now feel excited for the future opportunities it brings such as
  • I opened a brokerage investment account for the first time and bought some Tesla stock, which is my first ever non-index fund stock purchase. This helps with tax diversification.
  • Opened 529 accounts and started funding them. After maxing out retirement accounts and paying off debt, funding 529s for the kids is awesome.
  • It's also nice to know that I can use property taxes as a credit card bonus expense source if needed since they're my responsibility now.
  • Reopen our HELOC to have a higher line amount at a better variable rate. This lets me change my mind and use the money to invest instead if desired.



I hope it feels better than the meh / indifference after paying off my student loans. Anyone else feel like that?

I wasn't super pumped in the last year or so leading up to paying ours off.  What made it exciting for me was when I realized we could scrounge up enough cash to pay it off about 6 months ahead of schedule.  That spontaneous decision, and the series of transactions immediately afterward (requesting the payoff letter, scheduling the wire transfer from our bank, seeing the $0 balance on the mortgage) was quite a rush.

We basked in the afterglow of that excitement for quite some time.  Naturally it fades after a while, but 11 months later it's still a very pleasant memory to relive.  Not having the mortgage during all the fear and uncertainty during the early days of COVID did give us palpable peace of mind.

It was a little unnerving for me this week. The payment was done electronically on Wednesday and showed as "unapplied" for two days. Friday it finally showed as paid in full. However, seeing that is Awesome. The timing may be poor though since my school taxes were due Friday and I have to check if the bank paid them from escrow or I have to now. Little things...


I hope it feels better than the meh / indifference after paying off my student loans. Anyone else feel like that?

Paying off the mortgage felt like an achievement and it was a reason to celebrate.

The real bonus for me kicked in a few months later, it felt like I received a raise. Then covid happened and nobody knew what the future would bring, having no payments gave me a peace of mind. Now I see businesses closing down around me and I have worries about my own but I know that if necessary I can take less profits from the business to help it weather the storm, paid off house allows me to do this.

I hope to have the same feeling come first of the month.

It'll be 2 years to the day Jan 19th that I paid the mortgage off AND we downsized.   It's completely changed the pace of net worth growth (skyrocketing with cashflow investment vs. the old mortgage days).  And during a pandemic and my job loss, our net worth increased because I didn't have to raid our investments to live AND could take risks when the market tanked last March instead of hiding in cash to be safe and liquid.   Best thing we ever did.

Congrats on downsizing and the net worth skyrocketing! I also feel like I could take on riskier things that could pay off even better such as starting a YouTube channel or releasing some informational product.

Spoon

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Re: Mortgage Payoff Club!!
« Reply #2154 on: January 18, 2021, 03:52:01 AM »
We managed to hit mortgage payoff in 2020, and then turned around and did the least mustachian thing possible, loaded up on debt! We are upgrading our life and I can't wait. We have been looking to get out of suburbia for years and are moving to 25 acres this weekend.

At this stage there is no plan for paying off the debt, just lots of spending. From here the rough plan is
Clean and lightly renovate the existing house
Buy the wife a 4WD, there is a creek at the bottom of the property that crosses the road in/out that occasionally floods and the extra height is needed to get through
Fix the run down farm machinery, buy livestock and get planting
Adjust the driveway into a loop, clear 2 new building envelopes
Build a tiny/shipping container house to airbnb
Start airbnb -ing
Build another portable place to rent
Sell one/both/as many as necessary
Use the money from the sales to build something bigger and more permanent for holiday renting and live in when required
Knock down the existing house and build from scratch

Iím a builder (contractor to US folks) and I would rather work more years and build myself a new house than retire earlier. Once the new build is complete it will be time to smash the debt once again. Hopefully I remember how :)

couponvan

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Re: Mortgage Payoff Club!!
« Reply #2155 on: January 21, 2021, 07:21:18 AM »
@Spoon congrats on the property.  I called my husband's newfound desire for "land" a midlife crisis, but we're about 12 years older than you, and the idea of farming in old age does NOT sound appealing to me.  12 years ago it would have been awesome!

nereo

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Re: Mortgage Payoff Club!!
« Reply #2156 on: January 21, 2021, 08:52:46 AM »
Dave is significantly more solid than folks around here give him credit for.

I think he's awesome at connecting with his audience and convincing them to change their behavior for the better.
He gives great advice for getting out of debt, particularly for people who have had problems controlling their spending.

His investing advice seems suspect and designed to funnel people to high fee investments.

As is being discussed in another thread, DR is also an anti-masker and workplace tyrant who fires people who do things he doesn't approve of in their private lives. He browbeats employees and callers who don't agree with him... I could go on...

So it's not just the message, but also the messenger.

https://forum.mrmoneymustache.com/off-topic/dave-ramsey-is-an-anti-masker/
https://www.nashvillescene.com/news/pith-in-the-wind/article/21145502/get-a-load-of-this-unhinged-email-from-dave-ramsey-and-co
https://religionnews.com/2021/01/15/dave-ramsey-is-tired-of-being-called-a-jerk-for-his-stands-on-sex-and-covid/

SwordGuy

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Re: Mortgage Payoff Club!!
« Reply #2157 on: January 21, 2021, 09:23:40 AM »
Dave is significantly more solid than folks around here give him credit for.

I think he's awesome at connecting with his audience and convincing them to change their behavior for the better.
He gives great advice for getting out of debt, particularly for people who have had problems controlling their spending.

His investing advice seems suspect and designed to funnel people to high fee investments.

As is being discussed in another thread, DR is also an anti-masker and workplace tyrant who fires people who do things he doesn't approve of in their private lives. He browbeats employees and callers who don't agree with him... I could go on...

So it's not just the message, but also the messenger.

https://forum.mrmoneymustache.com/off-topic/dave-ramsey-is-an-anti-masker/
https://www.nashvillescene.com/news/pith-in-the-wind/article/21145502/get-a-load-of-this-unhinged-email-from-dave-ramsey-and-co
https://religionnews.com/2021/01/15/dave-ramsey-is-tired-of-being-called-a-jerk-for-his-stands-on-sex-and-covid/

Fully agree.   Was limiting my comments to financial advice matters.

v8rx7guy

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Re: Mortgage Payoff Club!!
« Reply #2158 on: January 22, 2021, 08:13:27 AM »
So now that we have our duplex paid off (1/1/2021) we are using a portion of the new cashflow to target our main residence to be paid off by our FI Date 4/19/2035 (my 50th birthday).  It's going to take an extra $300/mo so now we are throwing a total $600/mo at the mortgage to have it done by our target date.  Can't wait!

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2159 on: January 24, 2021, 07:08:35 PM »
So now that we have our duplex paid off (1/1/2021) we are using a portion of the new cashflow to target our main residence to be paid off by our FI Date 4/19/2035 (my 50th birthday).  It's going to take an extra $300/mo so now we are throwing a total $600/mo at the mortgage to have it done by our target date.  Can't wait!

Congrats on knocking out the duplex!   Celebrate the moment!    Next, we conspire on how to accelerate or downsize the main residence (or do both) to be free and clear in less than half that time.   Bwah, ha, ha!   ;-)

BlueHouse

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Re: Mortgage Payoff Club!!
« Reply #2160 on: January 28, 2021, 12:16:11 PM »
I can't say that I understand paying off an investment property.  The expenses directly offset the income.  I would think that you'd want the expenses on a rental to be as high as possible. 

SwordGuy

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Re: Mortgage Payoff Club!!
« Reply #2161 on: January 28, 2021, 01:05:50 PM »
I can't say that I understand paying off an investment property.  The expenses directly offset the income.  I would think that you'd want the expenses on a rental to be as high as possible.

You want the paper expenses to be as high as possible, not the cash out of pocket expenses. :)

Segare

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Re: Mortgage Payoff Club!!
« Reply #2162 on: January 29, 2021, 04:56:05 AM »
I can't say that I understand paying off an investment property.  The expenses directly offset the income.  I would think that you'd want the expenses on a rental to be as high as possible.
Expenses are still just that, an expense. You get a portion of that taken off your tax liability, but not the whole thing or more than the whole thing. If your place is paid off you still get expenses to deduct, just not the mortgage interest one, and that is only a portion of the interest paid.

Lilium

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Re: Mortgage Payoff Club!!
« Reply #2163 on: February 04, 2021, 04:07:02 PM »
First payment post re-finance has been made.  Did not have the escrow from the previous lender yet, but I did have the whole Jan and extra payment to put toward the February bill.  2924 total extra.

Start: 168,090
New: 164,788.99

March will include the escrow from the old lender and the extra(?) from the new lender. Should be a bit over 6k.


swaneesr

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Re: Mortgage Payoff Club!!
« Reply #2164 on: February 04, 2021, 06:52:14 PM »
Do you ladies and gentlemen know what tomorrow is?

February 5th, 2021.

Our mortgage payment will come out of our checking account.

We have been accelerating the payments (x3) all of 2020.

We have also been saving in a separate account in addition to the mortgage. I guess we were worried about COVID and job losses. Decided to save up extra cash.

The payoff amount and the extra account may cross each other allowing us to make the final payment. Around $35k.

If the spreadsheet is correct, we can submit the final payment and cross the finish line. I still can not imagine having ZERO debt.

Following all you others has been inspiring.

So I wait until tomorrow to see if we made it.

Swanee.

PS I know this is not a big deal for some. Me 54, DW 52. Not real early.....


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Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2165 on: February 04, 2021, 08:26:57 PM »
First payment post re-finance has been made.  Did not have the escrow from the previous lender yet, but I did have the whole Jan and extra payment to put toward the February bill.  2924 total extra.

Start: 168,090
New: 164,788.99

March will include the escrow from the old lender and the extra(?) from the new lender. Should be a bit over 6k.
That'll get your indenture down ~20% if I interpreted it right...  You're killing it!   Keep focused because it's how you kill this debt and win!

Trifele

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Re: Mortgage Payoff Club!!
« Reply #2166 on: February 05, 2021, 02:41:15 AM »
Do you ladies and gentlemen know what tomorrow is?

February 5th, 2021.

Our mortgage payment will come out of our checking account.

We have been accelerating the payments (x3) all of 2020.

We have also been saving in a separate account in addition to the mortgage. I guess we were worried about COVID and job losses. Decided to save up extra cash.

The payoff amount and the extra account may cross each other allowing us to make the final payment. Around $35k.

If the spreadsheet is correct, we can submit the final payment and cross the finish line. I still can not imagine having ZERO debt.

Following all you others has been inspiring.

So I wait until tomorrow to see if we made it.

Swanee.

PS I know this is not a big deal for some. Me 54, DW 52. Not real early.....


That's a huge deal @swaneesr!  Congratulations!  :)

alcon835

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Re: Mortgage Payoff Club!!
« Reply #2167 on: February 05, 2021, 09:54:31 AM »
Do you ladies and gentlemen know what tomorrow is?

February 5th, 2021.

Our mortgage payment will come out of our checking account.

We have been accelerating the payments (x3) all of 2020.

We have also been saving in a separate account in addition to the mortgage. I guess we were worried about COVID and job losses. Decided to save up extra cash.

The payoff amount and the extra account may cross each other allowing us to make the final payment. Around $35k.

If the spreadsheet is correct, we can submit the final payment and cross the finish line. I still can not imagine having ZERO debt.

Following all you others has been inspiring.

So I wait until tomorrow to see if we made it.

Swanee.

PS I know this is not a big deal for some. Me 54, DW 52. Not real early.....


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This is awesome @swaneesr !!!!!!!!!!!

You gotta come back here and celebrate once you fully and completely own your home!

couponvan

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Re: Mortgage Payoff Club!!
« Reply #2168 on: February 05, 2021, 12:10:21 PM »
Go do the barefoot lawn dance on your very own ground.  Or the barefoot snow dance....just don't get frostbite.  Congratulations!!!

swaneesr

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Re: Mortgage Payoff Club!!
« Reply #2169 on: February 09, 2021, 04:51:06 PM »
It is done.

DW and I dropped off the cashiers check this morning and we are mortgage and debt free.

It is a fantastic feeling. I updated my online account just now and the loans category now displays ZERO.

What a great feeling. This is a great club to be in, nice when a long term goal is met, even if is was expected.

I hope everything is going well with you others. Set goals and keep moving forward!

Swanee and the Mrs. Swanee


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markbike528CBX

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Re: Mortgage Payoff Club!!
« Reply #2170 on: February 09, 2021, 06:37:27 PM »
Hey @swaneesr , could not have said the quote below better.
Go do the barefoot lawn dance on your very own ground.  Or the barefoot snow dance....just don't get frostbite.  Congratulations!!!
  I concur.


Trifele

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Re: Mortgage Payoff Club!!
« Reply #2171 on: February 10, 2021, 02:04:48 AM »
It is done.

DW and I dropped off the cashiers check this morning and we are mortgage and debt free.

It is a fantastic feeling. I updated my online account just now and the loans category now displays ZERO.

What a great feeling. This is a great club to be in, nice when a long term goal is met, even if is was expected.

I hope everything is going well with you others. Set goals and keep moving forward!

Swanee and the Mrs. Swanee


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Woo hoo!!!  Congrats!

alcon835

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Re: Mortgage Payoff Club!!
« Reply #2172 on: February 10, 2021, 06:29:49 AM »
It is done.

DW and I dropped off the cashiers check this morning and we are mortgage and debt free.

It is a fantastic feeling. I updated my online account just now and the loans category now displays ZERO.

What a great feeling. This is a great club to be in, nice when a long term goal is met, even if is was expected.

I hope everything is going well with you others. Set goals and keep moving forward!

Swanee and the Mrs. Swanee


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YEAAAAAAAAAAHHHH!!!!! Congratulations!!! What a HUGE accomplishment!

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2173 on: February 10, 2021, 08:24:59 PM »
It is done.


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And yet, freedom is just beginning!   Congrats!!

swaneesr

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Re: Mortgage Payoff Club!!
« Reply #2174 on: February 11, 2021, 05:26:50 AM »
Thank you all!

Whoís up next?


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Lilium

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Re: Mortgage Payoff Club!!
« Reply #2175 on: February 20, 2021, 04:41:28 PM »
So envious of all of you that are done with this journey!

Put all the returned from the mortgage companies back into it.  Will have some tax return money to put to it next month, but after that, it'll be the long slog.

Start: 168,090
Extra payment March: 6979

New balance: 157,411

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2176 on: February 23, 2021, 09:04:05 PM »
@Lilium,  About 10% off the top in a couple of months is awesome!  It's amazing what you can put towards it quicker than you think following MMM methods you learn from the forums here to change budgets, savings rate and setting milestone goals and rewarding you (and yours who buy-in) along the way...   And think about cash and other after-tax equity accounts in the market...   How quickly will you use those assets to kill that debt (leaving a 3-6 month emergency fund aside is plenty) AND then save to get back to those after tax balances with the right discipline...  Be brave, kill the debt, be free.   Accelerate wealth building from there.  IT WORKS!

CheapScholar

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Re: Mortgage Payoff Club!!
« Reply #2177 on: February 27, 2021, 07:40:08 AM »
Havenít visited this thread in a while, as I paid off my mortgage exactly 5 months ago right before my 40th birthday. Two things Iíll say:

(1) It was the best thing Iíve done on my FIRE journey so far. I absolutely love owning my home, itís a peace of mind like nothing else. I totally get the math and arguments for not paying off the house, but for me it was the right decision. I should mention that both my spouse and I max out all retirement accounts - not maxing out and paying down mortgages is foolish IMO. Also worth noting that Iím scheduled to hit my minimum FIRE number within 12-24 months.

(2) Youíd think this would be obvious, but once the mortgage is paid off your money just starts piling up on you. Of course, I knew weíd have more cash but I was kind of unprepared for just how fast it started accumulating. Part of this was COVID, as we havenít booked any travel and havenít really spent much money locally. Our mortgage payment/taxes/insurance was about 1K, and we were using another 1K per month to attack the mortgage principal. So basically we now have an extra 2k per month that we need to invest or spend, which means brokerage accounts and 529 plan.

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2178 on: March 12, 2021, 06:17:46 PM »
Well said @CheapScholar!   For anyone else reading this, the difference in your behavior after paying off ALL debt including mortgage is the most amazing thing you can do finan-tellectually IMO...   You realize you're at another level.   Who's next??
« Last Edit: March 12, 2021, 06:22:12 PM by Money Badger »

MaybeBabyMustache

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Re: Mortgage Payoff Club!!
« Reply #2179 on: March 13, 2021, 07:54:20 AM »
Congrats, @CheapScholar !

We're not done, but we did make some huge progress on our mortgage this week, so I'll share. Please note, we live in a VHCOL in the bay area, and despite the way the numbers sound, we do not own even close to a fancy house. It's fine, but this is all about location.

-Bought a house for $2.65M in February of 2017
-Put $650k down, mortgage for $2M
-It's been our goal to hit the half way mortgage point in four years
-We squeezed in just a month over that, and are sitting at a mortgage of $820k, as of yesterday
-We've also done substantial remodeling (cash) in the house. House is now worth $3.2M+, and we plan to live here for the next four years or so, until the kids are out of high school
-The next goal is to get the mortgage to $500k, and recast it, so we can comfortably live off of my husband's salary. I expect this to take 12-18 months

talltexan

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Re: Mortgage Payoff Club!!
« Reply #2180 on: March 16, 2021, 06:25:22 AM »
@MaybeBabyMustache , I'd be curious to know your reaction to Sam's claim that a jump up in Tech share pricess will lead to a jump up in Bay Area real estate:

https://www.financialsamurai.com/2021-financial-samurai-outlook-stocks-real-estate/


MaybeBabyMustache

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Re: Mortgage Payoff Club!!
« Reply #2181 on: March 16, 2021, 07:56:50 AM »
@MaybeBabyMustache , I'd be curious to know your reaction to Sam's claim that a jump up in Tech share pricess will lead to a jump up in Bay Area real estate:

https://www.financialsamurai.com/2021-financial-samurai-outlook-stocks-real-estate/

I disagree. Pre-COVID, there are correlations, but the CA exit (both at a company & individual level) is real. Post-COVID, many employers have said they will be granting significant WFH/remote flex. That has a couple of options. For companies offering full flex, I highly doubt the majority of their employees will continue to live in the bay area. For a company who, for example, wants you to come to the office a couple of times/month, I'm expecting that to make outer area communities that are currently too far for a daily commute, much more attractive. That will help spread people around a bit more than they are now. Personally, I think post-COVID, the market here will cool down quite a bit, as people figure out where they want to be long-term.

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2182 on: March 22, 2021, 07:10:07 PM »
@Maybe...   Geez, what a high stakes real estate market that's like nothing else so best of luck on the next 4 years.   Don't be shocked the MoneyBadger is saying this but, if you plan to really sell it in <5 years, it should be better to put the money to work growing income now (first eliminating all other monthly debts like autos, etc. that effectively create tax free monthly $ flow) than recast.   The recast then subsequent higher monthly paydown is good if you want to stay to kill the mortgage, but you're talking about being able to RETIRE in 4 years from playing the game with over $2M in cash in hand (or whatever is left in a LCOL home area as those remote workers are doing).   Or if you really stay put, the best bet would be to keep at it, then refinance from a Jumbo loan to a conventional loan with better rate...    It's a jumbo pivot point you're approaching literally and figuratively.

MaybeBabyMustache

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Re: Mortgage Payoff Club!!
« Reply #2183 on: March 23, 2021, 08:26:32 AM »
@Maybe...   Geez, what a high stakes real estate market that's like nothing else so best of luck on the next 4 years.   Don't be shocked the MoneyBadger is saying this but, if you plan to really sell it in <5 years, it should be better to put the money to work growing income now (first eliminating all other monthly debts like autos, etc. that effectively create tax free monthly $ flow) than recast.   The recast then subsequent higher monthly paydown is good if you want to stay to kill the mortgage, but you're talking about being able to RETIRE in 4 years from playing the game with over $2M in cash in hand (or whatever is left in a LCOL home area as those remote workers are doing).   Or if you really stay put, the best bet would be to keep at it, then refinance from a Jumbo loan to a conventional loan with better rate...    It's a jumbo pivot point you're approaching literally and figuratively.

Not shocked, & always welcome feedback. :-) We have no other debt, and have $2M+ in retirement accounts, separate from the house. Yes, the market is crazy here.

Nederstash

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Re: Mortgage Payoff Club!!
« Reply #2184 on: April 17, 2021, 05:55:07 AM »
So jealous of everyone here! Well done to everyone who's paid off their mortgage!

This week I paid off an extra 10,000. I kept debating whether I'd put it towards a new kitchen (nothing wrong with it, just cosmetics) or even a new home altogether, but I decided to stick around here for a few more years. Feels good!

Original mortgage: 223k
Current mortgage: 162k
Current home value: around 400k (market's crazy here too)

I'm planning to throw another 12k at the mortgage this year and then 22k a year after that. I'm currently 34 and a half years old... think I can knock it out before I'm 40? My interest rate is 3,6% and it's deductable (37,1% tax rate, so effective rate is 2,26%). Refi is too expensive, would take another 15 years to earn back the penalty.

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2185 on: April 24, 2021, 06:28:23 AM »
@Nederstash,   Nicely done so far!   Of course, the badger has gotta ask how we kill that debt in 3 years or less... If you can put $22K /yr in free cash flow, then you're well under $100K in 3 years.   So how much is in after tax investments at moment and/or bonuses or other windfalls you'd expect (or in the sofa cushions or stuff you could sell) that can kill this the next 3 years?  Make that the goal. 

The point is that you will have enormous free cash flow once mortgage freedom occurs.  This isn't about the old debate of "invest" vs. "payoff mortgage"...   It's about accelerating your freedom...  It allows maxing the retirement plans with increased tax efficiencies far more than the mortgage deduction AND it enables a level of freedom and more confident mindset that's HUGE when the other little challenges of life come along.  Map out a 3 year plan even if you don't have the funds today... amazingly, they will appear if you stay with it.  ;-)

Lilium

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Re: Mortgage Payoff Club!!
« Reply #2186 on: April 26, 2021, 05:03:19 PM »
Looks like I missed updating April...

Start: 168,090
Extra April: 2256
Extra May: 856

New Balance: 153,474

8.5% (?) paid off this year, so far.

Nederstash

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Re: Mortgage Payoff Club!!
« Reply #2187 on: April 27, 2021, 12:23:22 PM »
@Nederstash,   Nicely done so far!   Of course, the badger has gotta ask how we kill that debt in 3 years or less... If you can put $22K /yr in free cash flow, then you're well under $100K in 3 years.   So how much is in after tax investments at moment and/or bonuses or other windfalls you'd expect (or in the sofa cushions or stuff you could sell) that can kill this the next 3 years?  Make that the goal. 

The point is that you will have enormous free cash flow once mortgage freedom occurs.  This isn't about the old debate of "invest" vs. "payoff mortgage"...   It's about accelerating your freedom...  It allows maxing the retirement plans with increased tax efficiencies far more than the mortgage deduction AND it enables a level of freedom and more confident mindset that's HUGE when the other little challenges of life come along.  Map out a 3 year plan even if you don't have the funds today... amazingly, they will appear if you stay with it.  ;-)

Hey badger, thanks for the reply! 22.3k a year is what I can pay off extra without penalty (10% of the original mortgage). The penalty is based on the difference between the current interest rate and my interest rate and the remaining term I locked in the interest rate. I'd be looking at a 20% penalty... I'm sticking with the penalty free maximum and investing the (meager) leftovers. Should be able to knock it out before I turn 40!

Sargemo

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Re: Mortgage Payoff Club!!
« Reply #2188 on: May 10, 2021, 09:09:57 AM »
Dave is significantly more solid than folks around here give him credit for.

I think he's awesome at connecting with his audience and convincing them to change their behavior for the better.
He gives great advice for getting out of debt, particularly for people who have had problems controlling their spending.

His investing advice seems suspect and designed to funnel people to high fee investments.

As is being discussed in another thread, DR is also an anti-masker and workplace tyrant who fires people who do things he doesn't approve of in their private lives. He browbeats employees and callers who don't agree with him... I could go on...

So it's not just the message, but also the messenger.

https://forum.mrmoneymustache.com/off-topic/dave-ramsey-is-an-anti-masker/
https://www.nashvillescene.com/news/pith-in-the-wind/article/21145502/get-a-load-of-this-unhinged-email-from-dave-ramsey-and-co
https://religionnews.com/2021/01/15/dave-ramsey-is-tired-of-being-called-a-jerk-for-his-stands-on-sex-and-covid/

Fully agree.   Was limiting my comments to financial advice matters.

Dave gives very good debt and risk advice and has helped many compartmentalize and manage their debt loads.  Agreement on all topics is not so important.  People are as complex as their financial plans.

Huskerfan

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Re: Mortgage Payoff Club!!
« Reply #2189 on: May 11, 2021, 10:03:47 PM »
Just graduated from
The $75k-50k club.  Starting Mortgage Debt (July 2019) :  $90,835.26
(Not total mortgage... that was around $179k)

Beginning Mortgage Debt This Month: $52282
Paid Mortgage Debt This Month :  $3211
Ending Mortgage Debt : $49646

****Descriptive Text *****
$2636 off of principle

Well... I did it. 
I graduated and went below the $50k mark.
Iíll spend the next 2.5 years here as we countdown towards no more mortgage.

Dutch Comfort

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Re: Mortgage Payoff Club!!
« Reply #2190 on: May 21, 2021, 01:49:17 AM »
Hope I can join in here as well.
We're in Dutchieland where the housing market is ABSOLUTELY crazy.

House: bought in 2003 fully mortgaged to EUR 490K
Refinanced in 2013 - Mortgage EUR 390K
Did a few repayments and current mortgage is split in two parts:
Mortgage 1: EUR 254K, max yearly repayment is EUR 27K, but no repayment obligation since house value is around EUR 650K, financed at 2.62%
Mortgage 2: EUR 71K, max yearly repayment is EUR 12K, payment obligation is EUR 6K per year, financed at 2.59%

Our goal: to kill Mortgage 2 ASAP which will leave us with the relatively low monthly payment obligation of interest on Mortgage 1.
With the maximum yearly payment it will take us 6 years from now (contract is 12 years from now with the regular payments, so we try to get this to 6!). Any additional funds will be either in Mortgage 1 or invested.

Here we go
dateM1M2repayment date M2
Original270,000120,00006/01/33
May2021254,00071,00003/01/33


Goal: M2 repayment in May 2027?


@Nederstash: same country I think...... can you try to even out the interest ("rentemiddeling" in Dutch)? This will result in lower monthly payments, while you can still get to the maximum yearly repayments.


« Last Edit: May 26, 2021, 02:00:55 AM by Dutch Comfort »

alcon835

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Re: Mortgage Payoff Club!!
« Reply #2191 on: May 21, 2021, 06:53:00 AM »
Hope I can join in here as well.

Of course you can join! Welcome to the race!!! Here's hoping you blow your projected date out of the water!

talltexan

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Re: Mortgage Payoff Club!!
« Reply #2192 on: May 28, 2021, 08:58:12 AM »
It takes money to join. Send it to your lender, and they'll forward it to the moderators.

crowinghen

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Re: Mortgage Payoff Club!!
« Reply #2193 on: May 28, 2021, 11:51:23 AM »
New member of the club!!
 Sold our long time home yesterday, (we had a small mortgage still left on it)  moved to our downsized retirement home that is owned free and clear.
- Bittersweet, but great to be absolutely  totally debt free!
:)

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2194 on: June 01, 2021, 06:20:54 AM »
@Nederstash and @Dutch Comfort   Thanks for sharing your interesting scenarios in Holland!  Seems continental banking practices are all about keeping mortgage holders in debt by using prepayment penalties to reduce early prepayment of loans (presumably to keep the banks mortgage backed securities from losing value from balance reductions that reduce interest payments to their bond holders?)  And seems your bankers tend to favor the option to simply fully refinance loans instead of monthly prepayments (presumably to earn more loan origination fees, make mortgage bondholders more likely to earn your new loan's interest payments and keep the whole debt cycle going as long as the bank can?)  If so, the above seems to favor Neder's approach of a side account to grow to ultimately be able to write a check to pay off when ready to minimize penalties.    Curious how much in %age terms does it cost to simply payoff an ENTIRE loan in prepayment penalties there?   Does it vary by credit level or total mortgage balance for example?   And how much can be deducted from income taxes for mortgage interest?     

swaneesr

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Re: Mortgage Payoff Club!!
« Reply #2195 on: June 01, 2021, 07:02:06 PM »
New member of the club!!
 Sold our long time home yesterday, (we had a small mortgage still left on it)  moved to our downsized retirement home that is owned free and clear.
- Bittersweet, but great to be absolutely  totally debt free!
:)
Congratulations!


Sent from my iPad using Tapatalk

Dutch Comfort

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Re: Mortgage Payoff Club!!
« Reply #2196 on: June 02, 2021, 08:04:12 AM »
@Nederstash and @Dutch Comfort   Thanks for sharing your interesting scenarios in Holland!  Seems continental banking practices are all about keeping mortgage holders in debt by using prepayment penalties to reduce early prepayment of loans (presumably to keep the banks mortgage backed securities from losing value from balance reductions that reduce interest payments to their bond holders?)  And seems your bankers tend to favor the option to simply fully refinance loans instead of monthly prepayments (presumably to earn more loan origination fees, make mortgage bondholders more likely to earn your new loan's interest payments and keep the whole debt cycle going as long as the bank can?)  If so, the above seems to favor Neder's approach of a side account to grow to ultimately be able to write a check to pay off when ready to minimize penalties.    Curious how much in %age terms does it cost to simply payoff an ENTIRE loan in prepayment penalties there?   Does it vary by credit level or total mortgage balance for example?   And how much can be deducted from income taxes for mortgage interest?   

Mortgages here are interesting! A mortgage can be for no more than 100% of the house value (which can be lower than your purchase price, especially is these crazy housing market, so the rest is a obligatory downpayment). A mortgage of 50% or more of the house value (which, again, is not the purchase price) should be repayable on a straight line basis or as an annuity, the other part (max 50% of the house value) can be taken as a non-repayable loan. For the straight line /annuity part, you can get a tax deduction on the interest paid. For the non-repayable part, no tax deduction on the interest.
Usually, for the straight line / annuity part, you can repay 10% extra (sometimes 20%) without any penalty. If you pay more, the penalty is equal to the interest missed by the bank. For the non-repayable part, you can usually repay on a voluntary basis somewhere between 10-20% without any penalty. Again, the penalty is equal to the interest missed by the bank.
The above is the general structure since around 2010 because before that, mortgages could be on a fully non-repayable basis. So when you signed a contract for 30 years, you only paid interest, no repayment of principal. This changed after the financial crisis to the structure above, because a lot of people who had 100% non-repayable mortgages did not have the discipline to save for the repayment (which is due in 30 years in 1 go, or you had to refinance).

If you see our structure we have M1 which is non repayable for EUR 254K. I do not worry about that, since we're planning on selling the house in the future (house value is currently EUR 650K) and move to a smaller house once the kids are on their own.
M2 is repayable on a straight line basis in 20 years (currently 12 years and EUR 71K left). I want to get that part out of the way ASAP, since this will decrease our monthly expenses and then we can start repaying M1 if we want (or setup an account to grow, that is to be decided.....).

So, this is a little insight in the Dutch mortgage maze..... it is not as straight-line (pun intended) as you would think......

Money Badger

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Re: Mortgage Payoff Club!!
« Reply #2197 on: June 03, 2021, 08:29:18 PM »
@Dutch Comfort   Wow!   Talk about a system of endless indenture!    Good luck paying off the 71K and hope the downsize works out soon enough.  Time to get you out of that socialized, banker-lobby-induced mess...  Take care!

MaybeBabyMustache

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Re: Mortgage Payoff Club!!
« Reply #2198 on: June 06, 2021, 09:03:15 AM »
Congrats, @CheapScholar !

We're not done, but we did make some huge progress on our mortgage this week, so I'll share. Please note, we live in a VHCOL in the bay area, and despite the way the numbers sound, we do not own even close to a fancy house. It's fine, but this is all about location.

-Bought a house for $2.65M in February of 2017
-Put $650k down, mortgage for $2M
-It's been our goal to hit the half way mortgage point in four years
-We squeezed in just a month over that, and are sitting at a mortgage of $820k, as of yesterday
-We've also done substantial remodeling (cash) in the house. House is now worth $3.2M+, and we plan to live here for the next four years or so, until the kids are out of high school
-The next goal is to get the mortgage to $500k, and recast it, so we can comfortably live off of my husband's salary. I expect this to take 12-18 months

Okay, so chiming in with an update. Our mortgage is now at $700k, so another $120k paid off since my last update a few months ago. We're trying to sell our vacation house (the buyers are...a challenge). If that happens, it may be in scope to have our ridiculously expensive house paid off within the next year. Fingers crossed! What a milestone that would be.

talltexan

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Re: Mortgage Payoff Club!!
« Reply #2199 on: June 08, 2021, 08:35:07 AM »
That is some impressive downward movement, @MaybeBabyMustache . Net decrease per year on the principal balance exceeds many of our annual incomes!