To the OP, you are clearly awesome and on the right track and whether you pay off loans or buy a house, that will always be the case.

Something I would suggest would be sitting down with your kids and talk to them about this. Are they unhappy and dying to get out of your apartment or are they willing to “help the family out” by sacrificing their own bedroom now and serve as your cheerleaders. I think this is a great opportunity to introduce them to adult realities while empowering them by making them feel part of the discussion and solution.

From your comments, the student loan people are applying your extra payments as future payments instead of applying them to the principal. You are not reducing the interest expense unless the extra payments go to the principal. I would get that straightened out ASAP.

This was a misconception I had about our student loans at first. Don't worry, her lenders are not "applying your extra payments as future payments instead of applying them to the principal". Here's how it works.

Her loans have a principal balance at $30,000. Everyday, the interest accrues, but does not compound. This means everyday her total grows by about $30,000 x 7.125%/365 = $5.86. So let’s say she went 20 days without making a payment. Her principle is still $30,000, she has accrued $5.86 x 20 = $117 in interest, totaling $30,117. Now she makes a $1,000 payment. She first has to pay off all the accrued interest with the remaining going to principal, so her new principal would be $29,117 and interest now accrues at the rate of $5.68/day.

The “next official due date” is based on the original loan plan and minimum payment schedule. So let’s assume that according to her original loan schedule, $29,117 principal is where she would expect to be three months from now if she only made minimum payments; her next penalty free due date would be at that three-month mark.

If she so wanted, she could stop paying for three months and she would be in the exact situation as if she’d only paid the minimum instead of a large overpayment. This is meant to encourage you quickly pay down the loan since you can effectively give yourself a cushion of non-payment time if a crisis comes up and you will be no worse off than you originally planned for. As far as I know, this is a feature unique to student loans. Your mortgage still expects you to pay every month regardless of the amount you have overpaid in the past.