Mortgage Payoff Club!!

[dandypandys]

In 2005 when i bought the condo for 140k it was 2000 taxes a year.
Then the crash came- it went allllllllll the way down.
My Real Estate Agent said that they cannot put it up more than 3% a year now until someone else buys it again. Didn't know that.
My condo is still only worth $100k though. Decided not to sell again phew- every 2 years It seems I get the moving bug and revisit the option.
I am excited to keep saving for early retirement.

[talltexan]

@Livethedream , you are living MY dream!  Good on you and congratulations.  Did you post how fast you did it?

Just under 2 years, started at $187k. This includes paid for solar system as well. So all utilities water, sewer, power, garbage, and home owners insurance comes out to $1500 yearly + property taxes. This was part of our plan, building an efficient home with low maintenance, operating, and insurance costs.

Please don't judge me, but my first thought when I read this is "what kind of mustachian feels like zhe needs to own the whole solar system?!?"

[couponvan]

Just under 2 years, started at $187k. This includes paid for solar system as well. So all utilities water, sewer, power, garbage, and home owners insurance comes out to $1500 yearly + property taxes. This was part of our plan, building an efficient home with low maintenance, operating, and insurance costs.

Wow, the $1,500 figure is impressive!  Our electric alone runs about $1,800, though the northeast does have crazy high electricity rates.  I'm envious of your tiny home maintenance/utility nut!

Wait - WHAT....$1,800 for electric??? I am moving to the VA area - please tell me that is per year and not per month or I am going to have an apoplectic fit.....

[Car Jack]

Virginia is not the Northeast.  I lived in Virginia for grad school and electricity was half the rate we pay in Massachusetts.

[couponvan]

Virginia is not the Northeast.  I lived in Virginia for grad school and electricity was half the rate we pay in Massachusetts.

Nice.  You're right it's more East than Northeast.  I will be happy paying the same rates as IL when the property taxes are less by 2/3.  If they were just going to get it back in the utilities, I was going to be really annoyed.

[Bird In Hand]

Virginia is not the Northeast.  I lived in Virginia for grad school and electricity was half the rate we pay in Massachusetts.

Nice.  You're right it's more East than Northeast.  I will be happy paying the same rates as IL when the property taxes are less by 2/3.  If they were just going to get it back in the utilities, I was going to be really annoyed.

VA is part of the mid-Atlantic region, and nearly part of the Southeast!  :D

But yeah, the electricity rates in New England are obscene.  On par with Alaska, higher than CA in many cases, and really only Hawaii is worse.

[Livethedream]

@Livethedream , you are living MY dream!  Good on you and congratulations.  Did you post how fast you did it?

Just under 2 years, started at $187k. This includes paid for solar system as well. So all utilities water, sewer, power, garbage, and home owners insurance comes out to $1500 yearly + property taxes. This was part of our plan, building an efficient home with low maintenance, operating, and insurance costs.

woohoo well done!
We are about the same maybe-- how much is your property tax a year? ours is 200-- which is rad!

$200!? That’s crazy.

Ours is about $3800 a year.

[Megs193]

My husband got paid 3 times in June so I was able to put an extra 10k towards the mortgage this month so the balance is at 474k.  I’m guessing we won’t be able to pay any extra towards the mortgage next month because I just paid 6k for summer camp and purchased flights to see family in February but at least I made a nice payment this month.

[Plina]

My husband got paid 3 times in June so I was able to put an extra 10k towards the mortgage this month so the balance is at 474k.  I’m guessing we won’t be able to pay any extra towards the mortgage next month because I just paid 6k for summer camp and purchased flights to see family in February but at least I made a nice payment this month.

Out of curiosity, what kind of camp costs 6k?

[Megs193]

My husband got paid 3 times in June so I was able to put an extra 10k towards the mortgage this month so the balance is at 474k.  I’m guessing we won’t be able to pay any extra towards the mortgage next month because I just paid 6k for summer camp and purchased flights to see family in February but at least I made a nice payment this month.

Out of curiosity, what kind of camp costs 6k?

It’s for 2 kids so it’s 3k per kid but that was my reaction when I first found out how much camp cost. Unfortunately that is the going rate for camp in our area.  I actually wanted to hire a sitter on days I work over the summer and save some money but my husband went to camp and feels like it is worth it. My husband is not mustachian so I pick my battles.

[mrmoonymartian]

@Livethedream , you are living MY dream!  Good on you and congratulations.  Did you post how fast you did it?

Just under 2 years, started at $187k. This includes paid for solar system as well. So all utilities water, sewer, power, garbage, and home owners insurance comes out to $1500 yearly + property taxes. This was part of our plan, building an efficient home with low maintenance, operating, and insurance costs.

Please don't judge me, but my first thought when I read this is "what kind of mustachian feels like she needs to own the whole solar system?!?"

Ahahaha! Love this.

[ScottsdaleSaver]

June 2018 - $217K and I'm writing another check to principal for $5K tonight. The pay for grant work isn't in yet and the promotion happened and the higher pay rate kicks in this week (yay!). We're hoping to break the $200K mark by the end of the summer.

March 2018 - $227K  We made some good headway over the last quarter thanks to my bonus. We anticipate a couple more windfalls in the next quarter - grant work for my husband - & perhaps even a large promotion which would really speed things up. Send some good juju our way!

Jumping over here from a different mortgage payoff thread that never took off. We started the path to early payoff in earnest this June with a (free) refinance. We're on a 15-year mortgage at 3.25%, but I want to knock this thing out in 5.

Big picture - I want to time the mortgage payoff with my escape from corporate life. Our investments are where I'd like it to be at this point. We'll continue to max out our tax advantaged accounts, but everything after that is going towards this.

June 2017 - $254K
July 2017 - $251K
August 2017 - $248K
Sept 2017 - $245K
Oct 2017 - $244K
Nov 2017 - $241K
Dec - 2017 - $237K

[CheapScholar]

We just had a small windfall ($7,500 from in-laws) and put it towards the principal.  Brings us to $92,500. 

Somewhat amusing, the $7,500 gift was given to us by DW’s parents because my BIL got married, moved out and finally bought a house at 33.  In-laws could tell he needed the cash infusion and so my wife got an equal gift.  BIL purchased a 450K house and they only put down about 10%.  So they’re paying PMI, too.  I wouldn’t be surprised if they tapped equity at some point.  Meanwhile, we are on track to own our 215K (we purchased for 169K four years ago) home within a few years.

[frizzywhiskers]

May update.....$59,575.... waiting patiently for husbands bonus to come in.  21 more weeks at max until payoff - hopefully less.

This week's payment puts us at $48,969, finally broke free of the $50's!  The most exciting news is that my husbands bonus this year is going to be his best ever....right around the $35,000 for take home $$.  This means our plan is 100% on track.  This additional bonus payment will drop the mortgage to the $12,000 mark and then we will see if we decide to wipe it out, or let it zero out by Sept. 30.  Either way, feeling very grateful to be almost done!

[Trifle]

May update.....$59,575.... waiting patiently for husbands bonus to come in.  21 more weeks at max until payoff - hopefully less.

This week's payment puts us at $48,969, finally broke free of the $50's!  The most exciting news is that my husbands bonus this year is going to be his best ever....right around the $35,000 for take home $$.  This means our plan is 100% on track.  This additional bonus payment will drop the mortgage to the $12,000 mark and then we will see if we decide to wipe it out, or let it zero out by Sept. 30.  Either way, feeling very grateful to be almost done!

Congrats @frizzywhiskers ! You are in the home stretch!

[Money Badger]

End of June update...   Just around $43K.   And pitching in another ~$1K this next pay period just to hopefully be "sub-40K" at the closing table (which is likely to be higher than the car loan balance of whomever buys our place)...  Strange how the mental game works at this stage... Crossing each $10K interval is such a win!

[Finntastic]

5/2018: $105,297
6/2018: $97,842

Interest rate 6.25%

Goal to be paid by: 10/10/2020

[abpa]

Our current balance is $126,885 with 4% interest.  Today I adjusted my 403b contribution to max it out, am maxing out my IRA and throwing everything else at the mortgage.  I'd love to pay it all off by my 50th birthday in Dec 2020.  This means I'll need to take on some sort of side gig (ER shifts, maybe?) in order to kill the mortgage. 

[Megs193]

My husband and I have had too much cash on hand for awhile. After doing a case study we decided to put $45,000 towards the mortgage.  I made the transfer but am still waiting for the transaction to go through. Our new balance will be just under $427k.  Our original plan was to pay off the mortgage by the time my oldest starts college which would be a little over 9 years but now I’m hoping we can do it even sooner.  Our mortgage makes up over half of our monthly spending so reducing that to taxes and insurance only would make a huge difference in how much income we need per month after retirement.

[talltexan]

That is a lot of house.

[FIreDrill]

My husband and I have had too much cash on hand for awhile. After doing a case study we decided to put $45,000 towards the mortgage.  I made the transfer but am still waiting for the transaction to go through. Our new balance will be just under $427k.  Our original plan was to pay off the mortgage by the time my oldest starts college which would be a little over 9 years but now I’m hoping we can do it even sooner.  Our mortgage makes up over half of our monthly spending so reducing that to taxes and insurance only would make a huge difference in how much income we need per month after retirement.

I'm in a similar situation as you.  Just move to a HCOL area and our mortgage accounts for about 50-60% of our monthly expenses.  Although I'm not in the payoff club it's interesting to see someone in a very similar situation as mine attacking the mortgage.  Maybe someday we will pay it off early but for now, putting the money in investments makes us feel more comfortable.

[FIreDrill]

That is a lot of house debt.

Fixed that for you ;)

Depending on where they live that could be a very modest house or even a decent apartment/condo.

[SwordGuy]

Virginia is not the Northeast. 

Basic rule for US Geography -- if the state contained the capital of the Confederacy, it is not "Northern".   Or, for that matter, if it joined the Confederacy or wanted to.

[Megs193]

That is a lot of house.

We live in a HCOL area but it is a lot of house. I discovered MMM while it was in the process of being built. We hated moving and we love the house because we designed every part of it so our plan is to pay it off as quickly as possible.  We plan on moving to a LCOL area for retirement but unfortunately my DH has no interest in retiring so that won’t be for another 20+ years.

[frizzywhiskers]

May update.....$59,575.... waiting patiently for husbands bonus to come in.  21 more weeks at max until payoff - hopefully less.

This week's payment puts us at $48,969, finally broke free of the $50's!  The most exciting news is that my husbands bonus this year is going to be his best ever....right around the $35,000 for take home $$.  This means our plan is 100% on track.  This additional bonus payment will drop the mortgage to the $12,000 mark and then we will see if we decide to wipe it out, or let it zero out by Sept. 30.  Either way, feeling very grateful to be almost done!

Bonus came in as expected!  Whoop!  Down to $12,100 this week once the payment goes through.  The end is near.......

[redbirdfan]

I'm officially pledging to stop going back and forth between investing and paying off my mortgage.  I'm committing to paying off my mortgage.  I know that market returns may be higher, but I want the freedom of being debt free and I want to free up space for eventual Roth conversion ladders.  I'm using a HELOC to help me.  The HELOC cost me $175 for the condo questionnaire, but there were no closing costs, appraisal fees or any other fees.   This process starts Monday!  The plan is to apply most of the HELOC amount to the mortgage, deposit all extra funds and income into the HELOC and repeat when the balance gets back to the original amount.  When I make the lump sum payments to the mortgage, I will recast the mortgage.  This will reduce my required monthly payments so the difference will go back to the HELOC.  There is a $100 fee per recast with no limits on the amount of recasts possible.  I did not pay for any software to set anything up.  It's just me my spreadsheets, Mint and Personal Capital.  We'll see how this goes.     

Starting Mortgage Balance: $182,515
Starting HELOC funds available: $56,000
HELOC intro rate for the next 12 months: 2.74%
Mortgage Interest rate: 3.99%
HELOC rate after 12 months = Prime rate -.25 with a green energy purchase

[Money Badger]

@Frizzy...   GO, PAYOFF, WIN!!    Then enjoy every dollar working for you instead of for the bank!

[frizzywhiskers]

@Frizzy...   GO, PAYOFF, WIN!!    Then enjoy every dollar working for you instead of for the bank!

Yes - thank you! :-) It's very exciting!  We will likely pay off the final balance within the next month or so.  Need to inquire if there is any penalty involved in paying off the balance 2 months before the term is up! 

[talltexan]

I'm officially pledging to stop going back and forth between investing and paying off my mortgage.  I'm committing to paying off my mortgage.  I know that market returns may be higher, but I want the freedom of being debt free and I want to free up space for eventual Roth conversion ladders.  I'm using a HELOC to help me.  The HELOC cost me $175 for the condo questionnaire, but there were no closing costs, appraisal fees or any other fees.   This process starts Monday!  The plan is to apply most of the HELOC amount to the mortgage, deposit all extra funds and income into the HELOC and repeat when the balance gets back to the original amount.  When I make the lump sum payments to the mortgage, I will recast the mortgage.  This will reduce my required monthly payments so the difference will go back to the HELOC.  There is a $100 fee per recast with no limits on the amount of recasts possible.  I did not pay for any software to set anything up.  It's just me my spreadsheets, Mint and Personal Capital.  We'll see how this goes.     

Starting Mortgage Balance: $182,515
Starting HELOC funds available: $56,000
HELOC intro rate for the next 12 months: 2.74%
Mortgage Interest rate: 3.99%
HELOC rate after 12 months = Prime rate -.25 with a green energy purchase

That's a nice intro rate on your HELOC. I had heard about this HELOC method of paying down your mortgage, but I didn't consider it seriously because my mortgage APR was 3.0%. The float of the HELOC should help you make some progress, especially with that low teaser rate.

[Telecaster]

I'm officially pledging to stop going back and forth between investing and paying off my mortgage.  I'm committing to paying off my mortgage.  I know that market returns may be higher, but I want the freedom of being debt free and I want to free up space for eventual Roth conversion ladders.  I'm using a HELOC to help me.  The HELOC cost me $175 for the condo questionnaire, but there were no closing costs, appraisal fees or any other fees.   This process starts Monday!  The plan is to apply most of the HELOC amount to the mortgage, deposit all extra funds and income into the HELOC and repeat when the balance gets back to the original amount.  When I make the lump sum payments to the mortgage, I will recast the mortgage.  This will reduce my required monthly payments so the difference will go back to the HELOC.  There is a $100 fee per recast with no limits on the amount of recasts possible.  I did not pay for any software to set anything up.  It's just me my spreadsheets, Mint and Personal Capital.  We'll see how this goes.     

Starting Mortgage Balance: $182,515
Starting HELOC funds available: $56,000
HELOC intro rate for the next 12 months: 2.74%
Mortgage Interest rate: 3.99%
HELOC rate after 12 months = Prime rate -.25 with a green energy purchase

Someone mentioned this a while back, so I looked into and I flat don't see how it speeds up paying off the mortgage any more than simply making additional payments.   Is there something I'm missing?

[redbirdfan]

Someone mentioned this a while back, so I looked into and I flat don't see how it speeds up paying off the mortgage any more than simply making additional payments.   Is there something I'm missing?

There's nothing that you're missing for the most part.  The HELOC just allows for large lump sum payments that put you further down the amortization schedule so more of your subsequent payments is applied to the principal.  There is also no way I would put all disposable income towards my mortgage without the safety net of the HELOC for liquidity.  The HELOC allowed me to pay a large amount (for me) towards the principal at once.  I wouldn't hit that amount of principal in extra payments anywhere near as quickly.  The HELOC method works as a self-inflicted hair on fire debt that forces to me to focus on paying off the mortgage as soon as possible.  Left to my own devices my analysis paralysis caused me to end up with funds just sitting in checking and savings accounts waiting for investment options on which I never pulled the trigger.  I finally decided to get off the fence.  The HELOC makes financial sense, provides a liquidity buffer and most importantly forces me to concentrate on paying off the mortgage.  For me it's more of a personal behavioral finance crutch than a magic bullet. 

[talltexan]

I'm officially pledging to stop going back and forth between investing and paying off my mortgage.  I'm committing to paying off my mortgage.  I know that market returns may be higher, but I want the freedom of being debt free and I want to free up space for eventual Roth conversion ladders.  I'm using a HELOC to help me.  The HELOC cost me $175 for the condo questionnaire, but there were no closing costs, appraisal fees or any other fees.   This process starts Monday!  The plan is to apply most of the HELOC amount to the mortgage, deposit all extra funds and income into the HELOC and repeat when the balance gets back to the original amount.  When I make the lump sum payments to the mortgage, I will recast the mortgage.  This will reduce my required monthly payments so the difference will go back to the HELOC.  There is a $100 fee per recast with no limits on the amount of recasts possible.  I did not pay for any software to set anything up.  It's just me my spreadsheets, Mint and Personal Capital.  We'll see how this goes.     

Starting Mortgage Balance: $182,515
Starting HELOC funds available: $56,000
HELOC intro rate for the next 12 months: 2.74%
Mortgage Interest rate: 3.99%
HELOC rate after 12 months = Prime rate -.25 with a green energy purchase

Someone mentioned this a while back, so I looked into and I flat don't see how it speeds up paying off the mortgage any more than simply making additional payments.   Is there something I'm missing?

When I first learned about the HELOC method, I was skeptical, but I spent all afternoon making a spreadsheet. The reason it works is that you immediately put the money toward your mortgage, but time your bills that you pay from your HELOC for the end of the month, so there's actually a decent amount of float in your favor. Redbirdfan's HELOC has the added advantage of the lower interest rate.

[AccidentalMiser]

So, I’m going to start posting here since paying off the mortgages is the next thing in line for us.  We have three mortgages:

53k at 4% which I am currently sitting on the cash for the payoff and will be completed by the end of the month.
246k at 4% on the house that we are renting to our son with a purchase agreement to be completed by November.
107k at 3.5% on our home property of 17 acres which has two houses, one with a finished apartment in the basement.

I should note that we collect about 4000 per month in rent from these properties and live in one of them so they’re all producing for us.  I have mixed feelings about paying them off but I don’t want to carry debt into early retirement.

Mortgage total on 7/1/18 = 406k

[MangoAtPlay]

 Hi All -
 Just checking in to announce we paid off our mortgage July 1st!!!  We won't really notice a difference until the next paycheck though!  So glad to have the freedom to spend/save that money elsewhere!

[markbike528CBX]

Hi All -
 Just checking in to announce we paid off our mortgage July 1st!!!  We won't really notice a difference until the next paycheck though!  So glad to have the freedom to spend/save that money elsewhere!

It will be a surreal moment when you check your accounts and you don't have that expense.
Congrats!

[frizzywhiskers]

Hi All -
 Just checking in to announce we paid off our mortgage July 1st!!!  We won't really notice a difference until the next paycheck though!  So glad to have the freedom to spend/save that money elsewhere!

Congratulations!  That will be an amazing feeling!

[Megs193]

Hi All -
 Just checking in to announce we paid off our mortgage July 1st!!!  We won't really notice a difference until the next paycheck though!  So glad to have the freedom to spend/save that money elsewhere!

Congrats!

[pdxmonkey]

Congratulations.

[MaybeBabyMustache]

We have a vacation house & I'm actively trying to pay off the mortgage. Starting balance was $330K, and we're down to $217K. I'm super excited to get below $200K, and am trying to hit that in 2018. I only use extra funding (e.g. money that was unexpected, side hustle, random rebates/checks, etc) for this, so it will be tricky. But, I'm doing it! It would be great to free up the $1K or month a so of mortgage payments as we get closer to FIRE

[AccidentalMiser]

So, I’m going to start posting here since paying off the mortgages is the next thing in line for us.  We have three mortgages:

53k at 4% which I am currently sitting on the cash for the payoff and will be completed by the end of the month.
246k at 4% on the house that we are renting to our son with a purchase agreement to be completed by November.
107k at 3.5% on our home property of 17 acres which has two houses, one with a finished apartment in the basement.

I should note that we collect about 4000 per month in rent from these properties and live in one of them so they’re all producing for us.  I have mixed feelings about paying them off but I don’t want to carry debt into early retirement.

Mortgage total on 7/1/18 = 406k

53k mortgage paid off today.  353k left to go! 

[frizzywhiskers]

So, I’m going to start posting here since paying off the mortgages is the next thing in line for us.  We have three mortgages:

53k at 4% which I am currently sitting on the cash for the payoff and will be completed by the end of the month.
246k at 4% on the house that we are renting to our son with a purchase agreement to be completed by November.
107k at 3.5% on our home property of 17 acres which has two houses, one with a finished apartment in the basement.

I should note that we collect about 4000 per month in rent from these properties and live in one of them so they’re all producing for us.  I have mixed feelings about paying them off but I don’t want to carry debt into early retirement.

Mortgage total on 7/1/18 = 406k

53k mortgage paid off today.  353k left to go! 

Wahoo!  Nice work! :-)

[Money Badger]

Way to go MangoAtPlay...  Big step on the way to FI!

[red_pill]

I think I just joined the mortgage free club!!!!  Well, the last lump sum payment won't clear until Thursday, but I just made the call and it's locked in.  I'll believe it when I see the zero, and for now it seems too good to be true.

I wish I had better records, and I wasn't always paying attention to it, but I have several data points over the past five years.  Starting balance was $250K, so average pay down was about $50K per year, but really accelerated over the past year when we had a few little windfalls and we actually started focusing on it.

Nov 2013 - $250,000
Dec, 2014 - $188,000
April 2015 - $148,000
Aug 2016 - $115,000  (2015 and 2016 my wife was ill, and life took us for a roller coaster ride from hell, hence the slowedown)
April, 2018 - $48,000
July, 2018 - $20,000
Aug 2, 2018 - ZERO!

Now, next challenge is to immediately reallocate the mortgage payment amounts into investments.

This is such a strange feeling....

[Trifle]

I think I just joined the mortgage free club!!!! 
...
This is such a strange feeling....

Congrats @red_pill!  Good for you!! 

[frizzywhiskers]

I think I just joined the mortgage free club!!!!  Well, the last lump sum payment won't clear until Thursday, but I just made the call and it's locked in.  I'll believe it when I see the zero, and for now it seems too good to be true.

I wish I had better records, and I wasn't always paying attention to it, but I have several data points over the past five years.  Starting balance was $250K, so average pay down was about $50K per year, but really accelerated over the past year when we had a few little windfalls and we actually started focusing on it.

Nov 2013 - $250,000
Dec, 2014 - $188,000
April 2015 - $148,000
Aug 2016 - $115,000  (2015 and 2016 my wife was ill, and life took us for a roller coaster ride from hell, hence the slowedown)
April, 2018 - $48,000
July, 2018 - $20,000
Aug 2, 2018 - ZERO!

Now, next challenge is to immediately reallocate the mortgage payment amounts into investments.

This is such a strange feeling....

Congratulations!  That's awesome!

[birdman2003]

$10k to the principal, balance now under $80k!

[ender]

$10k to the principal, balance now under $80k!

Niiiiiice. :D

[frizzywhiskers]

5 years and $435,000 later . . . the mortgage is finally gone.
It's done ... it's over….terminated, mutiliated, mission accomplished!
It feels amazing and unreal all at the same time.
Our savings rate is about to triple…..we are 2 years from FI…..
shit is about to get real...

[Bird In Hand]

5 years and $435,000 later . . . the mortgage is finally gone.
It's done ... it's over….terminated, mutiliated, mission accomplished!
It feels amazing and unreal all at the same time.
Our savings rate is about to triple…..we are 2 years from FI…..
shit is about to get real...

Wow.  An average of $87k/yr toward your mortgage -- that is a seriously impressive payoff rate.  Congrats on your accomplishment, and may you attack the rest of your financial goals with equal verve!

[Trifle]

5 years and $435,000 later . . . the mortgage is finally gone.
It's done ... it's over….terminated, mutiliated, mission accomplished!
It feels amazing and unreal all at the same time.
Our savings rate is about to triple…..we are 2 years from FI…..
shit is about to get real...

Wow!  Congrats @frizzywhiskers !