Author Topic: Mortgage Payoff Club!!  (Read 233713 times)

pdxmonkey

  • Stubble
  • **
  • Posts: 220
Re: Mortgage Payoff Club!!
« Reply #800 on: April 04, 2016, 06:50:16 PM »
Anyone have projects planned for when they pay off the house?

Kind of struggling with this, actually. Our house is great, but there are some updates we want. Some we'll do cheap, some we won't. On the one hand we won't have a mortgage, and we purposely waited until we were paid off to do some upgrades.

On the other hand, it seems weird not to take full advantage of no mortgage land by dumping money into index funds or real estate. Opportunity cost is the issue I'm struggling with, I guess.

I'm planning to reward myself with some updates once my mortgage is paid off. Not a major addition or anything, but there are a couple doors that could use replacing, maybe some shutters instead of blinds.

mies

  • Stubble
  • **
  • Posts: 189
Re: Mortgage Payoff Club!!
« Reply #801 on: April 05, 2016, 03:49:16 AM »
I wouldn't feel bad about fixing up your house with your newly freed up mortgage payment money. We are going to fix up some stuff once we pay off the mortgage too. We are going to repair or replace our front porch. It's brick. I want to see if we can replace the sandstone treads and replace any cracked bricks. If we can't, we'll demolish it and replace it.

Our carpeting is getting worn too. The berber and has gotten snagged and there are some pet stains from the previous owner that can't be cleaned. We'll either replace it or refinish the hardwood beneath it. If the pet stains ruined the hardwood, we'll probably just do new carpeting.

The last big upgrade would be a new furnace and air conditioner. They are getting pretty old.

We'd like to do do the kitchen, bathroom, and build a new garage, but I'm not sure if we are going to stay in that house forever. I don't want to dump a ton of money on non essential fixes if we aren't going to be there for a long time.
« Last Edit: April 05, 2016, 03:55:57 AM by mies »
Less is more.

Heckler

  • Handlebar Stache
  • *****
  • Posts: 1155
Re: Mortgage Payoff Club!!
« Reply #802 on: April 05, 2016, 08:21:09 AM »
Still holding off on the ugly iron railings, dishwasher and water heater replacements until my asset allocation is rebalanced at least.   I buy US and EAFE in my RSPs, and CND in my TFSA.  The CND allocation is $3000 low, so just a month or two left then we will get the water heater replaced.  I just upped my RSP contribution to 38% of gross pay, so will need the cash to keep up with my TFSA.

couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #803 on: April 05, 2016, 01:49:55 PM »
$17,319 as of today remaining on the FIRE house.  Still trying to convince DH we should just pay the sucker off with available cash....
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




asauer

  • Bristles
  • ***
  • Posts: 406
  • Location: North Carolina
Re: Mortgage Payoff Club!!
« Reply #804 on: April 06, 2016, 08:36:36 AM »
Down to 77,996!  Actually, when I made the payment, it brought it down to 78,013 so I HAD to transfer a little extra so I could see that thousands number tick over.  I'm so easily amused.

dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #805 on: April 06, 2016, 11:49:29 AM »
$27, 116 to go!!!!! So Exciting.


Mortgage
Balance
$25,478.56

YEAHHHH i am going to put the 478.56 to round it up towards the end of the month if i can :)

Astreja

  • 5 O'Clock Shadow
  • *
  • Posts: 22
  • Location: Winnipeg, Canada
Re: Mortgage Payoff Club!!
« Reply #806 on: April 06, 2016, 10:15:19 PM »
As of Monday evening, mortgage balance is below $2000.  Principal is coming down nearly $175 a week, so I've got about 11 payments left to go and a projected payout date in late June.

dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #807 on: April 07, 2016, 06:25:10 AM »
As of Monday evening, mortgage balance is below $2000.  Principal is coming down nearly $175 a week, so I've got about 11 payments left to go and a projected payout date in late June.
wowwwww so close :)

asauer

  • Bristles
  • ***
  • Posts: 406
  • Location: North Carolina
Re: Mortgage Payoff Club!!
« Reply #808 on: April 07, 2016, 07:07:20 AM »
$27, 116 to go!!!!! So Exciting.


Mortgage
Balance
$25,478.56

YEAHHHH i am going to put the 478.56 to round it up towards the end of the month if i can :)

That's the best feeling isn't it?  When you can put enough pennies together to tip it over the edge?!  Love it!

motiv8ed

  • 5 O'Clock Shadow
  • *
  • Posts: 27
Re: Mortgage Payoff Club!!
« Reply #809 on: April 07, 2016, 01:42:38 PM »
Wow, after reading these posts, I had to join. Current Balance is: $119,781 Hopefully I will be able to stay motivated and join the club.

mies

  • Stubble
  • **
  • Posts: 189
Re: Mortgage Payoff Club!!
« Reply #810 on: April 07, 2016, 03:16:51 PM »
Wow, after reading these posts, I had to join. Current Balance is: $119,781 Hopefully I will be able to stay motivated and join the club.

You'll be surprised how quickly it goes down when you really set your mind to it. Welcome to the forum!
Less is more.

pdxmonkey

  • Stubble
  • **
  • Posts: 220
Re: Mortgage Payoff Club!!
« Reply #811 on: April 07, 2016, 06:45:41 PM »
Anyone have projects planned for when they pay off the house?

Kind of struggling with this, actually. Our house is great, but there are some updates we want. Some we'll do cheap, some we won't. On the one hand we won't have a mortgage, and we purposely waited until we were paid off to do some upgrades.

On the other hand, it seems weird not to take full advantage of no mortgage land by dumping money into index funds or real estate. Opportunity cost is the issue I'm struggling with, I guess.

I'm planning to reward myself with some updates once my mortgage is paid off. Not a major addition or anything, but there are a couple doors that could use replacing, maybe some shutters instead of blinds.

Lol. Yeah your list sounds a bit more reasonable than mine.

Our deck needs to be replaced. Not actually safe. And for this I'm doing the cheap option and just doing the same footprint and doing the work myself. Awesome.

After that, however...

We have three bathrooms we want to do to varying degrees. The kitchen "needs" a facelift, too, which is my toughest one, as we won't again additional utility like we will with the bathrooms or deck.  Talked to my wife last night and I think the plan is to do the deck and 2 of the bathrooms (with one of those two hopefully being done by me) and waiting on bathroom 3 and kitchen until we have another year of solid investing.

It helps that my kitchen is brand new a few years back. I bought a foreclosure and it had only half a floor and roaches in there. I got to rebuild it with a counter/cabinet layout that suits me. IMO the old layout was pretty bad. The new layout is much better for food prep and cooking. The roof has been replaced since I owned it as well. I do sometimes dream about some nice bathroom upgrades though.

When moving, I highly recommend getting a trashed place for cheaper and fixing it up how you like it with the difference you would pay on somewhere move in ready if you can. With a move in ready place there will still be things you don't like and want to change eeven if they're new.

motiv8ed

  • 5 O'Clock Shadow
  • *
  • Posts: 27
Re: Mortgage Payoff Club!!
« Reply #812 on: April 07, 2016, 06:58:28 PM »
Wow, after reading these posts, I had to join. Current Balance is: $119,781 Hopefully I will be able to stay motivated and join the club.

You'll be surprised how quickly it goes down when you really set your mind to it. Welcome to the forum!

Thank you, I hope so. Does anyone have a recommendation on the best way of paying down the mortgage? I struggle with deciding on whether to
- Apply money to the principal as I get it.
- Save for a few months, in case I need the money for something, then apply it to the principal.
- Invest in a brokerage account and then pay it off once I have enough invested.

dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #813 on: April 07, 2016, 07:53:46 PM »
these days i use mint.com to create a budget and have budgeted in 1 extra payment. a 2nd payment is what is left over from my budget etc and just before i get paid again. Makes me eager to not spend anything all month so the 2nd payment can be high :)
i always keep a certain amount in my savings too but that is built up already so i don't touch it.

BlueHouse

  • Handlebar Stache
  • *****
  • Posts: 2236
  • Location: WDC
Re: Mortgage Payoff Club!!
« Reply #814 on: April 08, 2016, 04:53:07 AM »
Does anyone have a recommendation on the best way of paying down the mortgage? I struggle with deciding on whether to
- Apply money to the principal as I get it.
- Save for a few months, in case I need the money for something, then apply it to the principal.
- Invest in a brokerage account and then pay it off once I have enough invested.
I do a mix of these. Each month I double the full principal amount when I make my payment, because I'm comfortable with and never really miss that amount. On top of that, every payment that I received from a rental for three years went into a sinking fund at a brokerage and last august I cashed that out and made a large principal payment. Now I'm waiting for my first work bonus and I'm going to apply that to principal. Once I get the mortgage down enough (hopefully this summer), I will recast the mortgage so that I'm not tied in to those high payments anymore and if I lose my high-paying job, I can still afford my house on a regular salary. Even after the recast, I plan to continue to pay as much monthly as I have been, just no more giant lump sums.
Sometimes nothing can be a real cool hand

couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #815 on: April 08, 2016, 12:19:59 PM »
Ok.  Down to 145k as we just signed on the new house.  We'll wait for it to go through today and then on Monday put additional $$ down.  If income and spending go as planned, with a little luck we'll be done in two years.

11 months and 23 days later - it's gone.

26, wife is 25. Think this will hit me tomorrow.

Won't really tell many people (besides thousands of people on the internet, I guess). My parents will know. Wife's brother/SIL will know. They're big mustachians thanks to me, and paid off their home last year and told us right away. Can't think of anyone else.

Cheers everyone.

CONGRATULATIONS!!! Amazing effort with $145K paid off in under a year.  You must have some great income levels and will power. 
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #816 on: April 08, 2016, 02:01:30 PM »
$27, 116 to go!!!!! So Exciting.


Mortgage
Balance
$25,478.56

couldn't help myself- put 5k in from our savings so down to 20,478.56 now! Can't wait to be in the teens!

motiv8ed

  • 5 O'Clock Shadow
  • *
  • Posts: 27
Re: Mortgage Payoff Club!!
« Reply #817 on: April 08, 2016, 02:43:21 PM »
Ok.  Down to 145k as we just signed on the new house.  We'll wait for it to go through today and then on Monday put additional $$ down.  If income and spending go as planned, with a little luck we'll be done in two years.

11 months and 23 days later - it's gone.

26, wife is 25. Think this will hit me tomorrow.

Won't really tell many people (besides thousands of people on the internet, I guess). My parents will know. Wife's brother/SIL will know. They're big mustachians thanks to me, and paid off their home last year and told us right away. Can't think of anyone else.

Cheers everyone.

Congratulations, thats awesome.

dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #818 on: April 08, 2016, 03:39:43 PM »
Ok.  Down to 145k as we just signed on the new house.  We'll wait for it to go through today and then on Monday put additional $$ down.  If income and spending go as planned, with a little luck we'll be done in two years.

11 months and 23 days later - it's gone.

26, wife is 25. Think this will hit me tomorrow.

Won't really tell many people (besides thousands of people on the internet, I guess). My parents will know. Wife's brother/SIL will know. They're big mustachians thanks to me, and paid off their home last year and told us right away. Can't think of anyone else.

Cheers everyone.
Amazing congrats!!!!!

MrDelane

  • Stubble
  • **
  • Posts: 211
Re: Mortgage Payoff Club!!
« Reply #819 on: April 08, 2016, 09:46:54 PM »
Wow.
Just wow.

That's an incredible achievement.
Congratulations to you both.

tightwaddy

  • 5 O'Clock Shadow
  • *
  • Posts: 37
Re: Mortgage Payoff Club!!
« Reply #820 on: April 10, 2016, 06:13:18 AM »
I've been part of this challenge since Aug. 1, without even knowing it existed :)  When my husband and I saw we were at the last $100K (originally $300K in Sept. 2004), we decided to do everything possible to pay it off by Jan. 1, 2017.

Aug 1, 2015: $101,100
April 1, 2016: $64,669

So, $36,404 done in 8 months.  Not quite on track, but we're hoping to pick up some steam once the warmer months roll in (living in Maine, heat is a big cost in winter--no AC in summer).  Working some side hustles and attic purge sales to get a little extra for principal.

pdxmonkey

  • Stubble
  • **
  • Posts: 220
Re: Mortgage Payoff Club!!
« Reply #821 on: April 11, 2016, 07:02:44 PM »
Jan. 2015 - ~100k
Oct. 2015 - ~$67500
Dec.3, 2015 - ~$60k
Feb. 5, 2016 - $52,108.53
March 7, 2016 - 49,774.21
April 11, 2016 - 48,700 to go. Had to pay taxes this month.

bzzzt

  • Bristles
  • ***
  • Posts: 302
  • Location: Chicago
  • 5v to Lightning Bolts...
Re: Mortgage Payoff Club!!
« Reply #822 on: April 11, 2016, 11:08:19 PM »
Great job to everyone.

Work has been slow over the last month (construction) but I don't hardly care since the mortgage is knocked out. I can pay my bills/spending by working one week a month. It's sweet!

JourneyToLaunch

  • 5 O'Clock Shadow
  • *
  • Posts: 29
    • JourneyToLaunch
Re: Mortgage Payoff Club!!
« Reply #823 on: April 12, 2016, 08:40:31 AM »
I would like to join this club!

Currently our mortgage is $357K at a 4.375% rate (30 years)

I would really like to pay off the mortgage as soon as possible since I would like to retire at 40 (in 7 years). My husband would continue to work and we would live off of his income. The goal is to payoff the mortgage as soon as possible since I can't foresee retiring and living on my husband's income comfortably with the mortgage in place.  How soon depends on how aggressive we want to get with paying it down. Here are some different scenarios (right now we are doing scenario 2 but would ideally like to move to Scenario 5 this year). It's hard to know how aggressive to be when we also want to put some money in 529 accounts and do taxable investing at the same time:

 
Scenario 1
Only paying off what owe, mortgage will be paid off when we are 61

Scenario 2
Extra $500 a month from investment property, mortgage will pay off when we are 51
 
Scenario 3
Extra $500 a month from investment property, AND my recent raise $235 per month, (round to a $300) ,  mortgage will pay off when we are 48

Scenario 4
Extra $500 a month from investment property AND my recent raise $300 , AND $10K a year from my annual  bonus , mortgage will pay off when we are 43

Scenario 5
Extra $500 a month from investment property AND my recent raise $300 , $10K a year from my annual  bonus AND $5K from Husband's extra jobs, mortgage will pay off when we are 42

Scenario 6
Extra $500 a month from investment property AND my recent raise ($300) , $10K a year from my  annual bonus AND $10K from Husband's extra jobs , mortgage will pay off when we are 41

 
Join me on my journey to launch  www.journeytolaunch.com

couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #824 on: April 12, 2016, 10:59:48 AM »
I would like to join this club!

Currently our mortgage is $357K at a 4.375% rate (30 years)

I would really like to pay off the mortgage as soon as possible since I would like to retire at 40 (in 7 years). My husband would continue to work and we would live off of his income. The goal is to payoff the mortgage as soon as possible since I can't foresee retiring and living on my husband's income comfortably with the mortgage in place.  How soon depends on how aggressive we want to get with paying it down. Here are some different scenarios (right now we are doing scenario 2 but would ideally like to move to Scenario 5 this year). It's hard to know how aggressive to be when we also want to put some money in 529 accounts and do taxable investing at the same time:

 
Scenario 1
Only paying off what owe, mortgage will be paid off when we are 61

Scenario 2
Extra $500 a month from investment property, mortgage will pay off when we are 51
 
Scenario 3
Extra $500 a month from investment property, AND my recent raise $235 per month, (round to a $300) ,  mortgage will pay off when we are 48

Scenario 4
Extra $500 a month from investment property AND my recent raise $300 , AND $10K a year from my annual  bonus , mortgage will pay off when we are 43

Scenario 5
Extra $500 a month from investment property AND my recent raise $300 , $10K a year from my annual  bonus AND $5K from Husband's extra jobs, mortgage will pay off when we are 42

Scenario 6
Extra $500 a month from investment property AND my recent raise ($300) , $10K a year from my  annual bonus AND $10K from Husband's extra jobs , mortgage will pay off when we are 41

I would go for Scenario 4.5, 50% of husband extra jobs (whatever those jobs might bring in) to the house....He can decide to put extra in or not.  Likely it will be somewhere between 41 to 42 and you will be all done.
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




JourneyToLaunch

  • 5 O'Clock Shadow
  • *
  • Posts: 29
    • JourneyToLaunch
Re: Mortgage Payoff Club!!
« Reply #825 on: April 12, 2016, 11:39:00 AM »
I would like to join this club!

Currently our mortgage is $357K at a 4.375% rate (30 years)

I would really like to pay off the mortgage as soon as possible since I would like to retire at 40 (in 7 years). My husband would continue to work and we would live off of his income. The goal is to payoff the mortgage as soon as possible since I can't foresee retiring and living on my husband's income comfortably with the mortgage in place.  How soon depends on how aggressive we want to get with paying it down. Here are some different scenarios (right now we are doing scenario 2 but would ideally like to move to Scenario 5 this year). It's hard to know how aggressive to be when we also want to put some money in 529 accounts and do taxable investing at the same time:

 
Scenario 1
Only paying off what owe, mortgage will be paid off when we are 61

Scenario 2
Extra $500 a month from investment property, mortgage will pay off when we are 51
 
Scenario 3
Extra $500 a month from investment property, AND my recent raise $235 per month, (round to a $300) ,  mortgage will pay off when we are 48

Scenario 4
Extra $500 a month from investment property AND my recent raise $300 , AND $10K a year from my annual  bonus , mortgage will pay off when we are 43

Scenario 5
Extra $500 a month from investment property AND my recent raise $300 , $10K a year from my annual  bonus AND $5K from Husband's extra jobs, mortgage will pay off when we are 42

Scenario 6
Extra $500 a month from investment property AND my recent raise ($300) , $10K a year from my  annual bonus AND $10K from Husband's extra jobs , mortgage will pay off when we are 41

I would go for Scenario 4.5, 50% of husband extra jobs (whatever those jobs might bring in) to the house....He can decide to put extra in or not.  Likely it will be somewhere between 41 to 42 and you will be all done.

Thx for the feedback, I think Scenario 4 is the best "middle ground" that still leaves some extra money to do other things.
Join me on my journey to launch  www.journeytolaunch.com

sonnys

  • 5 O'Clock Shadow
  • *
  • Posts: 20
Re: Mortgage Payoff Club!!
« Reply #826 on: April 14, 2016, 09:11:27 PM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

K-ice

  • Pencil Stache
  • ****
  • Posts: 676
  • Location: Canada
Re: Mortgage Payoff Club!!
« Reply #827 on: April 15, 2016, 01:40:33 PM »

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

I would appreciate any feedback.


How about these steps?

1) Use your savings to pay off your primary mortgage. 
2) Then take out a HELOC on your primary.
3)  Use primary HELOC to purchase a rental "cash" when a good rental deal becomes available.   
4) Then get a mortgage/HELOC on your rental once the crazy purchase time has passed & you can shop for the best rate without stress. 
5) Now pay off your HELOC on your house
6) Repeat steps 3-5 to get a second rental, once you are comfortable being a landlord.

Especially in Canada, the tax savings of paying off your own property with cash vs the rental can save thousands a year. We can only write off mortgage interest on Rentals.



couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #828 on: April 18, 2016, 11:15:01 AM »
$17,319 as of today remaining on the FIRE house.  Still trying to convince DH we should just pay the sucker off with available cash....

WE DID IT!!!! TODAY WE WIRED $17,327.01 TO THE BANK AND WE ARE MORTGAGE-FREE ON THE FIRE HOUSE. WOO HOO!!!

(The small extra amount is for recording deeds....)
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




Neustache

  • Handlebar Stache
  • *****
  • Posts: 1055
Re: Mortgage Payoff Club!!
« Reply #829 on: April 18, 2016, 12:04:03 PM »
Congrats, Couponvan!!

couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #830 on: April 18, 2016, 02:02:28 PM »
Congrats, Couponvan!!

Thank you!

Congrats! Still hasn't really hit us yet. I'd be curious how long it took others who graduated the "club" to feel a difference.

My wife listens to Dave Ramsey for entertainment value most days and he always says you can walk around barefoot in the grass and it feels different. 

We literally tried that haha.  Nothing.

We're happy we did it, we are "excited" i guess, but it doesn't feel any different.

I expect next month it will feel nice to transfer that mortgage payment into the kids' college funds to see those grow. When they were born, we had visions of huge college funds.  I'm at least glad we didn't put off retirement funds....
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




Lmoot

  • Stubble
  • **
  • Posts: 201
Re: Mortgage Payoff Club!!
« Reply #831 on: April 19, 2016, 11:25:00 AM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

Using all of your funds to pay cash on a rental...then waiting several years while saving up for another one is a lot of money you're not earning in those several years from rent. I say buy one rental, when you have a renter and costs have settled down, buy your second rental. At least make the cash work for 2 rentals. That way you have the renters paying down the mortgage, instead of using your savings. Also, the sooner you get renters, the quicker you can begin to apply the cash flow towards your income when applying for multiple mortgages....usually they won't do it until you have been receiving rental income for at least 2 years.

I'd be hesitant at using a HELOC on my primary for the rental property expenses. I'd rather risk one of the rentals than my personal property. But that's just a matter of tolerance of personal risk. Keep enough of the savings on hand to act as an efund (separate from your personal efund). Then when one of your rentals gains enough equity, take a HELOC out on that. Leave your personal residence out of it, is my opinion.

write_stuff

  • 5 O'Clock Shadow
  • *
  • Posts: 3
Re: Mortgage Payoff Club!!
« Reply #832 on: April 21, 2016, 05:35:56 PM »
I want in the club!

We bought our 375,000 house last September with 100,000 down and a 275,000 mortgage at 4.125%.

We are set up to pay biweekly payments, and starting in January we've been paying 1000 extra to the principle per month. That's already cut 6 years off the loan!


K-ice

  • Pencil Stache
  • ****
  • Posts: 676
  • Location: Canada
Re: Mortgage Payoff Club!!
« Reply #833 on: April 21, 2016, 07:58:36 PM »
I want in the club!
...

 That's already cut 6 years off the loan!

Welcome! That's a great start.

couponvan

  • Magnum Stache
  • ******
  • Posts: 2623
  • Location: Illinois
    • My journal
Re: Mortgage Payoff Club!!
« Reply #834 on: April 22, 2016, 06:26:18 AM »
I want in the club!

We bought our 375,000 house last September with 100,000 down and a 275,000 mortgage at 4.125%.

We are set up to pay biweekly payments, and starting in January we've been paying 1000 extra to the principle per month. That's already cut 6 years off the loan!

Hello!  It sounds like you are doing all the "write stuff"!
Why the hell are we going shopping? Buy sh*t, return other sh*t, go through sh*t and donate sh*t. Complain about having too much sh*t. Repeat. (Bracken Joy 2/17)




JourneyToLaunch

  • 5 O'Clock Shadow
  • *
  • Posts: 29
    • JourneyToLaunch
Re: Mortgage Payoff Club!!
« Reply #835 on: April 22, 2016, 08:50:57 AM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

So my husband agreed to putting $5K in from his extra jobs in addition to the $10K from my annual bonus every year to paying down the mortgage. However, I have thought of another strategy and want to get your wise  opinions.

What about instead of putting $15K a year towards the mortgage directly, we put it into a index fund/mutual account and at the end of the 7 years, decide what we want to do with the money from there. We will still be paying $800 a month towards the mortgage on a monthly basis (which gets the mortgage paid off by the time we are 48) but it seems like putting the $15K each year in an investment account allows us more flexibility. If in 7 years, we want to take all of the money and pay off the mortgage we can, or we can put it towards something else. Thoughts? I also posted more details on my blog but it doesn't get much traffic yet and I would like direct responses.
Join me on my journey to launch  www.journeytolaunch.com

Indio

  • Stubble
  • **
  • Posts: 212
  • Location: high cost of living area in east coast
Re: Mortgage Payoff Club!!
« Reply #836 on: April 22, 2016, 12:21:05 PM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

So my husband agreed to putting $5K in from his extra jobs in addition to the $10K from my annual bonus every year to paying down the mortgage. However, I have thought of another strategy and want to get your wise  opinions.

What about instead of putting $15K a year towards the mortgage directly, we put it into a index fund/mutual account and at the end of the 7 years, decide what we want to do with the money from there. We will still be paying $800 a month towards the mortgage on a monthly basis (which gets the mortgage paid off by the time we are 48) but it seems like putting the $15K each year in an investment account allows us more flexibility. If in 7 years, we want to take all of the money and pay off the mortgage we can, or we can put it towards something else. Thoughts? I also posted more details on my blog but it doesn't get much traffic yet and I would like direct responses.

A lot of people prefer to go the route of putting the money into investments and then using that to pay off the mortgage. You need to consider the 7% market growth potential vs the guaranteed return of reducing interest payments.
One of the advantages of investing the money is that you still have access to it and it isn't tied up in a mortgage. This way if you have an emergency, like a layoff, you still have funds to live on and pay the mortgage. Keep in mind the bank still wants to get paid monthly, even if you have paid down the balance. Lots of threads on here about that.

JourneyToLaunch

  • 5 O'Clock Shadow
  • *
  • Posts: 29
    • JourneyToLaunch
Re: Mortgage Payoff Club!!
« Reply #837 on: April 22, 2016, 06:14:59 PM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

So my husband agreed to putting $5K in from his extra jobs in addition to the $10K from my annual bonus every year to paying down the mortgage. However, I have thought of another strategy and want to get your wise  opinions.

What about instead of putting $15K a year towards the mortgage directly, we put it into a index fund/mutual account and at the end of the 7 years, decide what we want to do with the money from there. We will still be paying $800 a month towards the mortgage on a monthly basis (which gets the mortgage paid off by the time we are 48) but it seems like putting the $15K each year in an investment account allows us more flexibility. If in 7 years, we want to take all of the money and pay off the mortgage we can, or we can put it towards something else. Thoughts? I also posted more details on my blog but it doesn't get much traffic yet and I would like direct responses.

A lot of people prefer to go the route of putting the money into investments and then using that to pay off the mortgage. You need to consider the 7% market growth potential vs the guaranteed return of reducing interest payments.
One of the advantages of investing the money is that you still have access to it and it isn't tied up in a mortgage. This way if you have an emergency, like a layoff, you still have funds to live on and pay the mortgage. Keep in mind the bank still wants to get paid monthly, even if you have paid down the balance. Lots of threads on here about that.

Thanks for the feedback. I think we are going to go with putting the lump sums of the cash in investments for the next few years and see how things turn out from there.
Join me on my journey to launch  www.journeytolaunch.com

BlueHouse

  • Handlebar Stache
  • *****
  • Posts: 2236
  • Location: WDC
Re: Mortgage Payoff Club!!
« Reply #838 on: April 22, 2016, 08:03:13 PM »
Hi,

I have been really going back and forth on paying off the mortgage early or using the money to purchase extra income properties.  I have read about and discussed the HELOC method on other threads and wanted to bring it up again.  Speaking mathematically, the investment option makes more sense, but the heart wants to payoff the 30 year mortgage.  I believe with my current savings and savings rate I could pay off the mortgage in 6 years but at a cost of not acquiring any properties during that time which I don't like either.  Here is the calculator ("All in One" - needs Flash plugin) if you want to test for your financials -     

www.cmgfi.com/consumers/calculators

I think I have 3 options:

1. Use savings towards primary mortgage.  Any additional savings go towards payoff.
2. Use the savings and savings rate to purchase an investment property every year for 10 years a la "The Millionaire Real Estate Investor".
3. Use my savings to purchase an investment property outright and open a HELOC against it to use as a rainy day fund for emergencies.  I can then use the cash flow from rent to save money and buy another rental property in a year or two. 

It really bothers me that I have a 30 year mortgage and have money in the savings account earning nothing.  I don't want to buy multiple properties at the same time because I am still a novice and would like to go slow and do a "dollar cost averaging" method in real estate investing.  I think that the last option seems like a balanced approach to earning a better rate on my savings and still have flexibility for an emergency.  I have a 401K but I really have no faith left in the markets, especially over a short term.

I would appreciate any feedback.

Thanks,
Sonny

So my husband agreed to putting $5K in from his extra jobs in addition to the $10K from my annual bonus every year to paying down the mortgage. However, I have thought of another strategy and want to get your wise  opinions.

What about instead of putting $15K a year towards the mortgage directly, we put it into a index fund/mutual account and at the end of the 7 years, decide what we want to do with the money from there. We will still be paying $800 a month towards the mortgage on a monthly basis (which gets the mortgage paid off by the time we are 48) but it seems like putting the $15K each year in an investment account allows us more flexibility. If in 7 years, we want to take all of the money and pay off the mortgage we can, or we can put it towards something else. Thoughts? I also posted more details on my blog but it doesn't get much traffic yet and I would like direct responses.

A lot of people prefer to go the route of putting the money into investments and then using that to pay off the mortgage. You need to consider the 7% market growth potential vs the guaranteed return of reducing interest payments.
One of the advantages of investing the money is that you still have access to it and it isn't tied up in a mortgage. This way if you have an emergency, like a layoff, you still have funds to live on and pay the mortgage. Keep in mind the bank still wants to get paid monthly, even if you have paid down the balance. Lots of threads on here about that.
I did this for a few years.  Then when the market reached an all-time high AND I wanted to reallocate, I chose to reallocate from that sinking fund into the mortgage.  I plan to add one more chunk to the principal before I recast the mortgage balance.
Sometimes nothing can be a real cool hand

Heckler

  • Handlebar Stache
  • *****
  • Posts: 1155
Re: Mortgage Payoff Club!!
« Reply #839 on: April 24, 2016, 09:16:52 PM »
Congrats! Still hasn't really hit us yet. I'd be curious how long it took others who graduated the "club" to feel a difference.


I immediately started saving $5k/ month to my TFSA account (tax refund and bonus season), and have ratcheted my RRSP contributions to 40% straight off my pay, reducing income taxes nicely.  Still trying to figure out the fine balance line of investing 70% of income and having enough to cover the bills without dipping into cash savings.   I've used the principles from YNAB to forecast expenses and pay dates two months out, allowing me to maximize investments as soon as we can afford it.

In life we haven't noticed a difference at all, except my work is trying harder to keep me from leaving than I am afraid of a layoff.  I'm curious if payroll talks to HR.
« Last Edit: April 24, 2016, 09:24:28 PM by Heckler »

Faraday

  • Handlebar Stache
  • *****
  • Posts: 1200
  • Age: 55
  • Location: NC
  • Solar Powered Slice
Re: Mortgage Payoff Club!!
« Reply #840 on: April 25, 2016, 09:32:46 AM »
A lot of people prefer to go the route of putting the money into investments and then using that to pay off the mortgage. You need to consider the 7% market growth potential vs the guaranteed return of reducing interest payments.
One of the advantages of investing the money is that you still have access to it and it isn't tied up in a mortgage. This way if you have an emergency, like a layoff, you still have funds to live on and pay the mortgage. Keep in mind the bank still wants to get paid monthly, even if you have paid down the balance. Lots of threads on here about that.
I did this for a few years.  Then when the market reached an all-time high AND I wanted to reallocate, I chose to reallocate from that sinking fund into the mortgage.  I plan to add one more chunk to the principal before I recast the mortgage balance.

BlueHouse, I'm tracking almost exactly along with you. (not on amount, but strategy).  I will recast sometime in May. (We get only one, so I've been working to exhaust all possible options for paying down the principal.)

When the market is low, I push more toward the market. When the market is high, I push more toward the mortgage.  IMHO, this is just good portfolio management!
FIRE in 2020.

FerrumB5

  • Bristles
  • ***
  • Posts: 442
  • Location: Illinois
Re: Mortgage Payoff Club!!
« Reply #841 on: April 25, 2016, 10:03:07 AM »
Might be off-topic. Anyone here who were transferred from Flagstar to Regions? I can't establish an account at Regions, when I call they say - do it after May1st (which is my pay day), which makes me wonder if it screws my credit history etc.

pdxmonkey

  • Stubble
  • **
  • Posts: 220
Re: Mortgage Payoff Club!!
« Reply #842 on: April 25, 2016, 08:35:22 PM »
Jan. 2015 - ~100k
Oct. 2015 - ~$67500
Dec.3, 2015 - ~$60k
Feb. 5, 2016 - $52,108.53
March 7, 2016 - 49,774.21
April 11, 2016 - 48,700 to go. Had to pay taxes this month.
April 25 - 47,500 to go. Figured out all the other bills,taxes,etc and had enough to pay a bit more down.

rjbf65

  • 5 O'Clock Shadow
  • *
  • Posts: 64
Re: Mortgage Payoff Club!!
« Reply #843 on: April 26, 2016, 12:58:23 PM »
I'll join.

Started June 2014 at 71k.

It's currently $55k.  Goal is to finish it off by next June.   Have 20k in cash that would finish it off by then.  We are currently investing 15% as well.   Basically doing the Dave Ramsey plan.

Currently down to $51,500.  Hoping to get under $50K a month from today.

Down to $49660.  Was able to throw an extra $1555 at it this time.  Budgeting to be able to throw an extra $2500 next month.

$46,950 -- a $2,710 reduction this month.  October should be a little better with the magic of the 3 paychecks for me this month.  Should be under $40K by end of the year.

$41,843 -- a $5,107 reduction this month.  The 3rd paycheck was big this time.  Would love to be able to do that every month!  My goal for end of November is to get under 40K.  Once I'm at the $40K mark, I'll have about equal amounts of cash in the bank and mortgage balance.  Still also maxing out 2 Roth IRA's which speaks for $917 per month.  It is always tempting to stop the Roth or to throw a bunch of the available cash at it.  I think I'll just stay the course of throwing all the extra cash that was left over after the month at it.  Once the mortgage is gone, all towards investing.


$38,922 -- $2,921 reduction this month.  More travel and eating out this month, as well as property taxes and insurance slowed us down a bit.  But we are at the goal of being under $40K balance!  It's going down at a pretty good pace that I'm happy with!  We will have some Christmas expenses coming up this month but it shouldn't be all that bad.  My target is to hope to be under $37K at the end of December.

$35,898 -- $3,024 reduction this month.  Received a small bonus from work to more or less cancel out Christmas spending.  Also had to replace the wife's windshield.  Would love to be down to under $33K after January is up.  Have quite a few things on the horizon.  We are expecting our first child in late May.  With that we are planning on upgrading the vehicle fleet some.  While going from 3 vehicles to 2.  Just looking for more room and reliability.  Need to have the ability of hauling a child, 2 dogs, and luggage for trips to see our parents.  We have been on the mustachian side of things when it comes to vehicles.  Our 3 vehicles combined might be worth about 9 or 10K.  My goal is to have a paid for house as well as having atleast 1 newer vehicle also paid for by the time the baby arrives.  We are now at the position of having more cash than mortgage balance.  Really looking forward to knocking it out asap!  Another thing about having it paid off by the end of May is I'll finally be eligible to contribute to my 401K starting in July.  Would be wonderful to max out a 401K in just the remaining half of the year!

$32,026 -- a $3,872 reduction this month.  I always have to wait until the 5th or 6th of each month to process my extra payment.  I'm one of those weird ones that pay things as soon as I get the notice instead of holding on to the money for as long as possible.  If all goes well February and March have the potential to be good debt reduction months.  Tax refund in February hopefully and a 3 paycheck month in March.  We will be doing some vehicle upgrading with a new baby on the way but I will do everything I can to keep that cost to a minimum.


$31,609 --  a $417 reduction... I only made the normal payment this month and putting the agressive paydown on hold.  Some big possible life changes on the horizon and I want to have as much cash in the bank as possible just in case.  After the dust settles is when I'll finish it off.


$31,190 -- $419 reduction .. Another minimum payment.  Will be spending about $15K out of pocket upgrading the worn down vehicle fleet and adding room for the new baby next month.  Hope to finish off the mortgage by the end of 2016 or before.  Looking forward to getting the baby home and healthy and pressing reset on the paydown plan that we were doing so well at before.   

dandypandys

  • Bristles
  • ***
  • Posts: 303
  • Age: 44
  • Location: USA
Re: Mortgage Payoff Club!!
« Reply #844 on: April 29, 2016, 05:55:30 AM »
$27, 116 to go!!!!! So Exciting.


Mortgage
Balance
$25,478.56

couldn't help myself- put 5k in from our savings so down to 20,478.56 now! Can't wait to be in the teens!

wooohooo just got paid, and a few extras- so just dumped a bunch in!
Now at $17678.00 Mortgage payment comes off in a few days too- should take us to 16k something yayayay
« Last Edit: April 29, 2016, 01:05:11 PM by dandypandys »

asauer

  • Bristles
  • ***
  • Posts: 406
  • Location: North Carolina
Re: Mortgage Payoff Club!!
« Reply #845 on: April 29, 2016, 12:58:38 PM »
Yes!  $71,000 as of today!  Going to get a couple of side hustle checks in the next couple of weeks and am hoping to be able to knock that sucker down to the 60's!

BlueHouse

  • Handlebar Stache
  • *****
  • Posts: 2236
  • Location: WDC
Re: Mortgage Payoff Club!!
« Reply #846 on: April 29, 2016, 01:06:45 PM »
I can see how this gets exciting when you start getting close to zero.  I still have a really long way to go, so it's hard for me to get excited unless I'm making big dumps.  I am going to try to pass another x00,000 on the house-odometer before the summer though.  So I'll look forward to that!
Congratulations to those making great progress.  It really is inspirational.
Sometimes nothing can be a real cool hand

mies

  • Stubble
  • **
  • Posts: 189
Re: Mortgage Payoff Club!!
« Reply #847 on: April 29, 2016, 03:15:30 PM »
I can see how this gets exciting when you start getting close to zero.  I still have a really long way to go, so it's hard for me to get excited unless I'm making big dumps.  I am going to try to pass another x00,000 on the house-odometer before the summer though.  So I'll look forward to that!
Congratulations to those making great progress.  It really is inspirational.

Don't get discouraged! Just try to break your mortgage payoff down in to mini goals. We used to use getting to the next $10,000 dollar mark as a goal (Going from $90,000 to $80,000). We also used the goal getting the principal portion of your mortgage payment up to a certain value (If we pay this much extra principal, the monthly principal goes up to $800). It makes it a lot easier to stay focused on the big goal if you have some smaller milestones along the way.
Less is more.

PFHC

  • Pencil Stache
  • ****
  • Posts: 653
  • Age: 36
  • Location: Midcoast Maine
  • Busy doing.
Re: Mortgage Payoff Club!!
« Reply #848 on: April 30, 2016, 01:36:18 AM »
Mar 2016: $126,942
Apr 2016:$126,644

SAfAmBrit

  • 5 O'Clock Shadow
  • *
  • Posts: 68
Re: Mortgage Payoff Club!!
« Reply #849 on: April 30, 2016, 08:49:34 AM »

Principal paid off so far

2012 - $3415
2013 - $3994
2014 - $8483
2015 - $38412 (yup got rid of all the debt and $10 000 windfall not expected)
2016 - $27707 so far

3/1 Remaining balance $87322. Projected pay off date 09/09/2017 - SO 51st birthday.

4/1 Remaining balance $81837

4/30 Remaining balance $76952 (I owed the tax man!)