The Money Mustache Community
General Discussion => Welcome and General Discussion => Topic started by: LeRainDrop on December 11, 2015, 09:29:03 PM
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Hi, everyone, despite being active on this site for a year, I've only just started playing around with the welcome/introduction section. Here, I found a couple fun polls of the forum members, which inspired me to start this poll. Specifically, the demographics poll asked the amount of "debt" the members have. It appeared some people were not counting their mortgage and at least one did not even count his student loans. To get clarity on the mortgage question, I thought I would start this poll. I hope you enjoy participating and seeing the results!
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Cannot see the poll with the app I am using.
We purchased our home in May 2014
Purchase price : 330k
Mortgaged balance : 306k
Current balance : ~298k
Sent from my iPhone using Tapatalk
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You don't have the option "No, I bought my house with cash and have no mortgage."
MOD EDIT: Added one, bottom option.
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You don't have the option "No, I bought my house with cash and have no mortgage."
MOD EDIT: Added one, bottom option.
Oh, you're right, I didn't even think of that! Way to go, Altons Bobs!
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Between 1 & 50, but a hell of a lot closer to $1.
$250k on a $270k purchase in 2003, to be paid off in full Feb 2016. Two more months!
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Between 1 & 50, but a hell of a lot closer to $1.
$250k on a $270k purchase in 2003, to be paid off in full Feb 2016. Two more months!
Nice job, Heckler! You're on the home stretch -- pun intended :-)
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Bought June of 2015 after selling another home that did not meet our needs in any way.
It was on a busy city street corner, no yard, side yard butted up to the busy 2 lane road and was very dangerous.
To small, and we hated it after a few months of living there. Lived there for quite a few years and waited for the market to come back. We sold it and made out very nicely.
Moving and buying a new home has helped us out psychologically so much.
New home bought for 220k, mortgaged for 176k. Currently owe 174k.
Interest rate is 4.5% for 30 years.
Just to clarify I was VERY apprehensive about buying this home. But we low balled the seller and the home is worth a lot more then 220k. Seller accepted the initial offer, very surprised at that. Now I wish we would have said 210k instead.
I'm happy here and we are not all on top of each other. I know others do it but 7 people in a 1000 sq foot house just wasn't doing it for us, especially because of the yard issue.
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We were mortgage free on our last house since 2011. For the 3 years prior we had been paying one payment per paycheck, or 3 payments a month. The mortgage really drops fast when you do that!
We just bought a new, "keeper" house for us on Nov 30th. Mortgage of 182,200 on a purchase price of 227,600. 20% down payment and an instant 142,000 in equity. (We bought at 30% below appraised value. Woot!).
I'm torn between paying off the mortgage when either my mom's house or our old house sells, or investing. I *know* I should invest instead of pay off the mortgage. We'll see.
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$58,217 until Monday sometime when the payment clears.
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Our balance is around £58,000 at the moment.
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Mortgage free paid cash.
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Paid cash.
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Didn't pay cash, but paid it off in 2010 sometime. At the time also owned an upside-down house which we sold (at a loss but not as bad a loss as it was at the very bottom!) at the beginning of 2014. So, have been completely debt-free for nearly 2 years!
DH bought the house in 1998, for less than half what it's likely worth now (based on recent neighborhood sales). When I moved in, I paid to principal what I had been paying in rent. Time + dedication = success!
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Okey, Dokey
We need more of those MMM Californians responding!
I know the average home value around here is around $800k, worse in CA, unless you choose a condo / apartment / townhome (which is $400k-$500k). Given the massive incomes reported on other threads, and about half of us preferring to invest instead of paying off mortgage... there must be more people here with high mortgages.
? anyone?
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$70000 balance left on an $88000 mortgage. I bought my house in 2010. I plan on paying off the mortgage in the next 2 years.
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
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The current balance on my mortgage is $107K I was initially paying extra on it but earlier in the year refinanced to a 15 year 3% mortgage so now I am in no rush (Originally bought house in 2010 on a 30 year 4.5% mortgage with a mortgage balance of $200K)
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
Yeah, that is a fairly common mistake made by immigrants. It's a lot better than blowing your money on consumer goods though. Is Calgary really that bad a real estate market right now?
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$440k. Ugh. But I'm doing my best to pay it off early and I have greater than 55% equity just 4 years into the 30 year mortgage.
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
Is Calgary really that bad a real estate market right now?
I am trying to stay optimistic while planning for the worst scenario. We like Calgary but we're moving to our little slice of paradise in the gulf islands and we'd prefer not to be long-distance landlords. So our first option is to sell both units, which are both in trendy and sought-after areas. One in particular, a modern industrial loft, is a block from the future National Music Centre scheduled to open in March. I paid $227K five years ago, and new cookie-cutter, less appealing units on offer right now in the neighborhood are priced well above $450K so I'm hoping to get at least $300K, if not close to what we paid for. I'm getting a bit stressed over this but if we don't get what we are hoping for, we'll keep them as rentals (our rental already nets us $1000/month after expenses, the other, much bigger, should net about the same or more) for a couple of years or until the market rebounds. Hindsight is always 20/20...
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Paid $152k in 09, owe $87k. Same floorplan 2 blocks away went on the market last week at $225k. If his sells anywhere near that, mine will be on the market soon after.
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
Is Calgary really that bad a real estate market right now?
I am trying to stay optimistic while planning for the worst scenario. We like Calgary but we're moving to our little slice of paradise in the gulf islands and we'd prefer not to be long-distance landlords. So our first option is to sell both units, which are both in trendy and sought-after areas. One in particular, a modern industrial loft, is a block from the future National Music Centre scheduled to open in March. I paid $227K five years ago, and new cookie-cutter, less appealing units on offer right now in the neighborhood are priced well above $450K so I'm hoping to get at least $300K, if not close to what we paid for. I'm getting a bit stressed over this but if we don't get what we are hoping for, we'll keep them as rentals (our rental already nets us $1000/month after expenses, the other, much bigger, should net about the same or more) for a couple of years or until the market rebounds. Hindsight is always 20/20...
If less desirable units are being sold for $450K, why are you only looking to sell for $300K?
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515k. But the place is worth 760k (a little "Daddy's only girl" discount (via my wife) and a private sale let us get in for 70k down...). Locked in at 3.75 after 3 refi's (only good part about deploying to AFG). Since that works out to about 25% of my net worth I cannot bring myself to be much more aggressive in paying it down (the mortgage payment, when tax adjusted and with the other fee's all mean I am paying less than what it would cost to rent a nice 3BR in my area).
Though I will pop some bubbly in early 2017 when it drops below a half million...
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Should be under $100K soon... started at $112K or so and have knocked it down to about $105K in a year. In another year when we hit the 2-year mark, we have to be at about $97K to remove PMI, which should be easy.
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Primary residence owe $280K , paying extra principal every month(2.5% interest rate)
Investment property 1 owe $165K , paying extra principal every month(3.5% interest rate)
Investment property 2 owe $130K , paying extra principal every month(4.125% interest rate)
Investment property 3 owe $80K , used HELOC(current variable rate 2.85%)
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Hubby and I have been chatting about our mortgage lately. We bought in 2012 with a $256K mortgage and sub 3% interest rate, and accelerated bi-weekly payments designed to achieve an 11-12 year amortization. We're just dipping below $200K now, but I'm growing increasingly leery of a Canadian real estate bubble and would like to drop the mortgage before our renewal date comes up in 2017. We currently have about a 65% savings rate, and the newly elected government just cut back the limit for TFSA contributions by $9K a couple, so we'll be redirecting all the TFSA money to the mortgage and more of our investment money to the mortgage.
FIRE date is 2020 so I don't want a mortgage after that. However, if our investment returns stay reasonable and mortgage rates stay low, we'll have to find the right balance. We plan on selling the house in a few years time for a nice sum, so even if there's a mortgage, it can be paid off leaving us with a nice chunk of equity in our pockets.
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
Is Calgary really that bad a real estate market right now?
I am trying to stay optimistic while planning for the worst scenario. We like Calgary but we're moving to our little slice of paradise in the gulf islands and we'd prefer not to be long-distance landlords. So our first option is to sell both units, which are both in trendy and sought-after areas. One in particular, a modern industrial loft, is a block from the future National Music Centre scheduled to open in March. I paid $227K five years ago, and new cookie-cutter, less appealing units on offer right now in the neighborhood are priced well above $450K so I'm hoping to get at least $300K, if not close to what we paid for. I'm getting a bit stressed over this but if we don't get what we are hoping for, we'll keep them as rentals (our rental already nets us $1000/month after expenses, the other, much bigger, should net about the same or more) for a couple of years or until the market rebounds. Hindsight is always 20/20...
If less desirable units are being sold for $450K, why are you only looking to sell for $300K?
I don't want to hijack the thread with my case...but in my situation, it is due to my irrational fear of getting stuck with these properties and become a de facto long-distance landlord, with all the potential stress involved. I am weighing the pros and cons with a clear head and won't make any hasty decision, thanks to all the guidance I can now get on this forum.
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Okey, Dokey
We need more of those MMM Californians responding!
I know the average home value around here is around $800k, worse in CA, unless you choose a condo / apartment / townhome (which is $400k-$500k). Given the massive incomes reported on other threads, and about half of us preferring to invest instead of paying off mortgage... there must be more people here with high mortgages.
? anyone?
The average house value in CA is nowhere near $800k, closer to $450k. If you're talking about some of the more desirable areas, sure. In my city I believe it's around $550k.
My mortgage is about $270k. Started at $390k about 5 years ago, plan is to have it paid off in 15. I estimate my LTV is about 40%.
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Just passed my one-year anniversary of being mortgage free!
$165k purchase price, paid off in 8.5 yrs. Salary ranged from 56k-96k. Bought it with my H, but had to give him half the equity (I based on purchase price) when we divorced, so ultimately I did it all on my own. We were on a 5-year plan together, so it didn't really set me back that much.
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Looks like I "win" so far. My balance is around 580K. We just bought a house a few months ago with 20% down. Our home budget is quite modest compared to other bay area homes and what we could "afford" based on our income (according to those affordability calculators we should be buying a home for 1.25-1.5M)!
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Bay area resident here.
We have ~$443K remaining on our mortgage. We put about 29% down on a $680K house a few years ago. We've been lucky to have bought in before the recent run-up in prices here. Zillow (and recent comps) indicate our house is now worth ~$1.2-1.3M.
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Okey, Dokey
We need more of those MMM Californians responding!
I know the average home value around here is around $800k, worse in CA, unless you choose a condo / apartment / townhome (which is $400k-$500k). Given the massive incomes reported on other threads, and about half of us preferring to invest instead of paying off mortgage... there must be more people here with high mortgages.
? anyone?
Ha ha I just voted, right there with you.
Median home price here is a little over a million. Median home price for homes of our size (2BR, 1BA, 1100 sf, bad school district) is more like $730k. (less than we paid, boo!)
We've been in our house 11 years. Original price was 3/4 million (a little over that, actually), currently owe around $420k. We pay extra every month. It's a psychological thing for me.
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CA resident here (Ventura). 30 yr fixed at 3.75% after a refi (bought in 2013 with 30 yr 4.75%). Principal balance is 420k on a 440k loan. Put 200k down on the 640k purchase price. House was appraised at 750k earlier this year during the refi. Our mortgage (including taxes/insurance) is $2700/month, which isn't a big deal after factoring in the sizeable tax deduction for the mortgage interest, property taxes, and state taxes (like 40k in deductions).
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Yes,
Purchase price in 2011: 315K
mortgage original balance: 249,900
current balance: 94k
Aggressive payoff is the name of the game
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CA resident here (Ventura). 30 yr fixed at 3.75% after a refi (bought in 2013 with 30 yr 4.75%). Principal balance is 420k on a 440k loan. Put 200k down on the 640k purchase price. House was appraised at 750k earlier this year during the refi. Our mortgage (including taxes/insurance) is $2700/month, which isn't a big deal after factoring in the sizeable tax deduction for the mortgage interest, property taxes, and state taxes (like 40k in deductions).
Waving to you from up north SB...
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Looks like I "win" so far. My balance is around 580K. We just bought a house a few months ago with 20% down. Our home budget is quite modest compared to other bay area homes and what we could "afford" based on our income (according to those affordability calculators we should be buying a home for 1.25-1.5M)!
My mortgage balance is around $650k.
I have about $750k in equity according to Zillow.
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Just got under $400k. Purchased for $570k 2 years ago in Denver, value has probably increased by $75k-$100k.
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The most surprising thing is the astonishing low amount of renters.
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Hmm
210K at 2.74% Zillow says the house is worth $312k, but that's a bit optimistic. Bought in 2012 for 236K, 5% down.
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The most surprising thing is the astonishing low amount of renters.
Maybe the renters wouldn't click on a thread that appears to be all about mortgages.
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We just bought in March and owe $258k on a $275k mortgage. Yay PMI! Renting is stupid expensive here, though, and we're hoping this little house sees us through to retirement in 2030.
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Good Lord, some of these home prices are killing me. I have a 2300 sq 4 bedroom built in 1995 that I paid $152k for 6 years ago, and I'm thinking of selling so I can use my equity to buy something outright.
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Good Lord, some of these home prices are killing me. I have a 2300 sq 4 bedroom built in 1995 that I paid $152k for 6 years ago, and I'm thinking of selling so I can use my equity to buy something outright.
But the quality of life is incredible here (in California) and totally worth braving the expensive real estate. I can have my feet in the sand at the beach and on a boulder on a 5000' mountain almost within the same hour.
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Paid $680,000 - $507,000 left at 4%. Should have it paid off at the very latest by 2024. Not a huge priority to pay it off at this interest rate but I am not trying to start a religious war on payoff vs. investing. :) Zillow lists the value at $1.45M.
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Interesting on an MMM forum of avowed 'stachians that less than 15% total (who bought a home have paid it off or paid cash for it) based on the poll results thus far. Seems national average is higher, including CA...
From 2013 LA Times article: "While millions of Americans have suffered the angst of lost homes, equity and pride, nearly a third of the nation's homeowners have no mortgage at all, according to an estimate released Thursday by real estate website Zillow."
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Interesting on an MMM forum of avowed 'stachians that less than 15% total (who bought a home have paid it off or paid cash for it) based on the poll results thus far. Seems national average is higher, including CA...
From 2013 LA Times article: "While millions of Americans have suffered the angst of lost homes, equity and pride, nearly a third of the nation's homeowners have no mortgage at all, according to an estimate released Thursday by real estate website Zillow."
If your APR is 6+ pay it off now, between 3 and 6, your choice, below 3 invest. At least that is the way my mind works.
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Well, looks like I'm the first one to admit that I live with family for free (I chip in for utilities, ultimate MMM strategy?). Stupid California prices.... Small & old 3 bed/1 bath on a crappy lot up the street sold for $1.2M and the first thing the new owners did was to tear the place down and start new construction. I can't deal with these prices for a primary residence on my salary unless I want a nice, long, expensive commute.
On the up side, I have a few rentals bought during the downturn that are doing well (but aren't close enough for me to use as a primary residence).
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Our property tax estimate just came in, our evaluation went up from 190 to 236K. We have a 68K mortgage, 2.85% interest. People on this forum would definitely say, keep the mortgage, and we are (won't be paid off forl 10 years). But I would be lying if I got a windfall I would be tempted to pay it off. Not mathematically optimal but it would be peace of mind. If I had a paid off house we could make it work even if I ended up having to take a cut in pay for whatever reason.
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Bay area resident here.
We have ~$443K remaining on our mortgage. We put about 29% down on a $680K house a few years ago. We've been lucky to have bought in before the recent run-up in prices here. Zillow (and recent comps) indicate our house is now worth ~$1.2-1.3M.
Holy shit!
I thought our area was doing well! Our home value up 26% since we bought 9 years ago. Just dropped to under $400k on the mortgage -- $399k+ as of last statement. I enjoyed seeing the balance begin with a 3 instead of a 4.
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Bay area resident here.
We have ~$443K remaining on our mortgage. We put about 29% down on a $680K house a few years ago. We've been lucky to have bought in before the recent run-up in prices here. Zillow (and recent comps) indicate our house is now worth ~$1.2-1.3M.
Holy shit!
I thought our area was doing well! Our home value up 26% since we bought 9 years ago. Just dropped to under $400k on the mortgage -- $399k+ as of last statement. I enjoyed seeing the balance begin with a 3 instead of a 4.
My house value increased 44% since I bought it almost exactly 6 years ago... unfortunately, being a LCOL area, that means it only increased from $107K to $154K*, or $47,000.
(* I'm in the process of a last-minute-before-the-rates-rise refinance, so that's based on an actual appraisal from earlier this month. The county tax commissioner thinks the house is worth $115K and Zillow thinks its worth $286K, so that gives you an idea of how wildly inaccurate those sorts of things can be.)
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Bay area resident here.
We have ~$443K remaining on our mortgage. We put about 29% down on a $680K house a few years ago. We've been lucky to have bought in before the recent run-up in prices here. Zillow (and recent comps) indicate our house is now worth ~$1.2-1.3M.
We sound like neighbors.
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Just dropped to under $400k on the mortgage -- $399k+ as of last statement. I enjoyed seeing the balance begin with a 3 instead of a 4.
I feel the same way. I recently crossed the threshold from a $200k+ balance to $198k. Amazing how seeing that "1" as a leading digit makes me so happy!
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Looks like I "win" so far. My balance is around 580K. We just bought a house a few months ago with 20% down. Our home budget is quite modest compared to other bay area homes and what we could "afford" based on our income (according to those affordability calculators we should be buying a home for 1.25-1.5M)!
Spud, I am in a similar $$$ position to you. We are setting it up to live in and bring some rental income from room mates (literally just moved). My SO and i had similar projections of what we could "afford" but that is just silly money. Housing (rental and purchase) is expensive where i live, but the income is better to compensate, and intangibles like family, lifestyle etc are there.
Scary to be in the upper numbers on here... but in Auckland, you can't buy a unit for less then 550k. And at that price you would want to spend a bit of money on it to bring it to a comfortable standard.
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Brand new here, this is only my second post after the introduction, working my way through the surveys. >$500k category here. Our principal is $590k. Paid $772k in 2012, 3.375% mortgage 30 year fixed. Current value on trulia/zillow is approx $1.06M. Everywhere we go daily is within 4 miles (and will be 2 miles once the youngest goes to kindergarten in 2017).
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Some of these CA answers make me feel ever so slightly better about our DC-area ridiculousness. Bought 4 years ago at $420K, worth ~$500K now, owe $360K (just refi'd at 3.25%). And that's for our 900sf duplex (but in such a great neighborhood).
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Okey, Dokey
We need more of those MMM Californians responding!
I know the average home value around here is around $800k, worse in CA, unless you choose a condo / apartment / townhome (which is $400k-$500k). Given the massive incomes reported on other threads, and about half of us preferring to invest instead of paying off mortgage... there must be more people here with high mortgages.
? anyone?
Californian here who is focused on investing not mortgage payoff. Our balance is around $270k. We live in a 2 bedroom condo. In a couple years we are going to buy a SFH so I expect that our mortgage will be closer to $500k...and that scares the shit out of me. We are going to delay moving as long as we can stand.
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We paid off our mortgage when we sold our home about 2 years ago.
We also own a small amount of land free and clear- about a half acre in Alta, California. It's very close to the tiny downtown
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I answered 200-300k, but it's just barely... Around 200,400--we should get below 200k with our next payment. Whoop whoop!
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Okey, Dokey
We need more of those MMM Californians responding!
? anyone?
Californian here who is focused on investing not mortgage payoff.
Also in this boat with a large mortgage (just dropped under $400,000 owing). We're relatively conservative and we like the mental aspect of paying down our mortgage, but I've been trying to resist the temptation to pay it off too fast.
For fun, I've lately been toying around with the idea that it might be most reasonable to do a cash-out refinance while property values are up and rates are low. A large fixed-rate debt is a great inflation hedge. (we're currently on an ARM)
Also, since mortgages in California are non-recourse, it seems like keeping your home equity as low as possible would be a great hedge against a crash in the housing market (assuming you are willing and able to walk away, moral judgement aside and all that). I'm pretty sure that's what they call a moral hazard (https://en.wikipedia.org/wiki/Moral_hazard). I can be just like an investment banker...
This is just a mental excercise for now, but the reasoning sounds solid.
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I think we have about 24,800$ left out of a 345,000$ purchase price after 6 years.
Only a few more months :).
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$380k... A few days off making my first payment against this bad boy.
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Bought in 2011:
Purchase Price: 225K
Amount down: 45K (20%)
Terms: 15 year loan at 3.125%
Amount of principle remaining on loan: 163K
Current Value of home according to Zillow: 314K
My estimate of current value of home: 280K
Estimated equity in home: 117K
Side note: I highly recommend everyone who can consider a 15 year mortgage over a 30 year. We pay only a tiny bit more each month, but the additional amount of each payment that goes towards principle is night and day more. And for people on this site who are often looking to retire early, it seems like a no brainer to me.
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Main House bought in Sept 2013:
Purchase Price: $175K
Amount down: $35K (20%)
Terms: 5/1 ARM at 2.50%
Amount of principle remaining on loan: $5.8K
Current Value of home according to Zillow: $280K
My estimate of current value of home: $240K
Estimated equity in home: $234K
Would have paid it off sooner but the loan require 3 yrs or else I will have to pay back some of the closing costs.
Will be paid off end of 2016.
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House bought in Feb 2013:
Purchase Price: $140k
Amount down: $7k (5%)
Terms: 30yr fixed @ 3.75%
Amount of principle remaining on loan: $126k
Current Value of home according to Zillow: $176k
My estimate of current value of home: $160k
Estimated equity in home: $34k
I'm hoping Zillow is accurate, but I'm skeptical of that much growth so quickly.
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Bought in 2006: <----terrible rotten horrible timing :)
Purchase Price: $205k
Amount down: ~$30k (bad that I can't remember, south of 20% but not by much and took out an 2nd mortgage ARM to get to 20% so no PMI and paid off in <1 year -- because, you know, we needed to buy before we were priced out of the market, uggg)
Terms: 30yr fixed refi to 20 yr fixed refi to 12 yr fixed now about 7 years left
Amount of principle remaining on loan: $90k
Current Value of home according to Zillow: $165k <--fairly accurate and STILL below the high 10+ years ago, uggg
Whatever, we bought at a terrible time at the height of the market but on the plus side we bought a home that worked for not only then, but now that we have 2 kids. I'd "like" to move based on some factors I know now, but we don't "need" to move and have such a low mortgage relative to income that we're still OK even after making such a horrible mistake in buying during the bubble.
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Owe 195k on a 265k purchase in 2013. Zillow is very kind, claims there's 40,000 appreciation, but I don't believe it.
Sent from my iPad using Tapatalk
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Yes, I have a mortgage
3 years in to a 15 year loan
Balance of $57,129.43
3.75% interest rate
$650 a month with escrow
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Still in our first year of the mortgage on our new house, purchased in April. So we probably owe about $315k of the original $318k balance on a house bought for $335k and currently worth, with improvements done and market appreciation, +/- $350k. Spent around $15k of cash to get to that point (hence the small down payment).
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I am frugal and great at saving, but I admit to be a financial dummy. I paid my current residence cash, and another rental practically cash, both in Calgary. I'm of a generation of immigrants who fled poverty and in my case a bloody civil war, who were allergic to debt of any kind and firmly believed in putting all their money in something tangible they could see and feel. Most of my peers think this is fantastic but I realize in hindsight that locking my money in illiquid assets was the worst financial mistake of my life. I'm paying for this big mistake now that I am close to retirement, but have half of my assets locked in a crumbling real estate market.
Yeah, that is a fairly common mistake made by immigrants. It's a lot better than blowing your money on consumer goods though. Is Calgary really that bad a real estate market right now?
ykphil might regret it, but I definitely wouldn't see that as a mistake. If not for my wife, I'd have saved until buying in cash. Then again, I'm also by default an ERE / YMOYLtype rather than an MMM type, and my motto before my wife had always been no debt, ever. With her, we took on debt for the mortgage, but that's it (unless she convinces me to invest in an income property).
Regarding the poll, bought with mortgage, paid it off in a few years. I've believed for much of my life that the most basic retirement vehicle is a paid off house, and I love the knowledge that nothing more than a part time min. wage job could keep us in our home for the rest of our lives.
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Wife and I owe about 120K on a house we purchased for 160K two years ago. Two years ago I hit what I can only describe as the professional equivalent of me winning the lottery. New employer doubled my previous salary and I recently got a raise, so I make about 105K, and my wife brings in some money working part time but should be full time very soon.
Our home is nice for our area, we live in very low cost of living part of the country (Indiana). Question I ask myself everyday is, should I just pay off the mortgage? We have about 60K in investments that could be sold at any time. I also max out 18K into my 403B retirement. I'm 35. I know I can pay off my mortgage within a few years by making a few smart decisions. I hate my mortgage, but I find comfort that we only spend 8% of our gross income on housing (mortgage plus property taxes).
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I bought in 2013 for 480K in Manhattan (it's modest, clearly). I put 15% down, then had a purchase HELOC for 24K and a mortgage of 384K.
Over the past two years I've paid my standard mortgage payments, and was aggressively paying down my HELOC. Then I had to come up with 64K for a roof repair, and bridged the gap with more HELOC. As of this month, my apartment is worth ~615K, I owe 360K on the mortgage, and 39K on the HELOC.
The HELOC has been at 3.25 but is variable and I imagine will be going up soon, so I threw 10K at it last month, and may accelerate that payoff. Or maybe I should be investing. I go round and round on this.
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No, we sold our home and moved to a different town to care for my elderly 90 year old inlaws, renting a house nearby.
We want to buy property after caregiving ceases. In order to start a self sustaining community in an offgrid town about 30 minutes away.
We've been attending church there for years, it's a State Recreation area wonderful for cycling and what not. Cabins will be tiny, unpermitted and we'll charge a little rent to help us stay afloat while saving our earned income.
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Side note: I highly recommend everyone who can consider a 15 year mortgage over a 30 year. We pay only a tiny bit more each month, but the additional amount of each payment that goes towards principle is night and day more. And for people on this site who are often looking to retire early, it seems like a no brainer to me.
I have a 30 year mortgage but pay it off like a 15 yr mortgage. The change in interest rate was minimal for me and I have flexibility if something comes up.
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I probably have one of the worse situations:
We started to build our house in 2001, still not finished, so can't refinance (or sell) (don't even get me started!!)
$330k loan @ a whopping 5.75% (~$650k value, so can't complain too much)
Luckily (well, not really all luck, we made some good decisions), we are high income and have been stashing away for investments. But just recently, we've made the decision to payoff the mortgage in 4 years and stopping our investments during that time (except 401ks). We'll throw $240k extra over the 4 years and then free up about $2500/month.
I was always in the invest your extra dollars camp, but now I think I'm going for the guaranteed 5.75% return, plus piece of mind of a paid off mortgage.
Of course, the real winning decision would be to move the fuck out of our house.....sigh, if only I could convince DH.
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but now I think I'm going for the guaranteed 5.75% return,
Maybe I'm thinking about the math wrong, but if you're high income and itemize deductions, isn't the mortgage offering a guaranteed return of less? Say, 4.5%? That might not sway your decision, but just something to consider.
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Owe 195k on a 265k purchase in 2013. Zillow is very kind, claims there's 40,000 appreciation, but I don't believe it.
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Ha Zillow gave us 100k in appreciation, which is probably 'right' for the current Denver market, but definitely not right when considering the intrinsic value of our little shit-box
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House bought in: April 2007 - Not sure it gets a lot worse than that. We had to move due to jobs and it has been rented (barely breaking even) since Sept 2008. I did not use this house to answer the poll.
Purchase Price: $135k
Amount down: $7k (~5%) - Stupid I know now
Terms: refinanced to 30yr fixed @ 4.25%
Amount of principle remaining on loan: $115k
Current Value of home according to Zillow: $124k
My estimate of current value of home: $110k
Estimated equity in home: Negative (we put additional money into remodels) - I can't wait until we can unload it.
House bought in: Nov 2011 - Primary residence, I only used this house to answer the poll.
Purchase Price: $95k
Amount down: $5k (~5%) - Stupid I know now
Terms: 15yr fixed @ 3.25%
Amount of principle remaining on loan: $65k
Current Value of home according to Zillow: $202k
My estimate of current value of home: $175k
Estimated equity in home: $55k (we have put money into updates)
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Live in the DC burbs, bought in 1998 for $135k, paid off in 2011. Comparables last year sold for $350-$375k, though to get it ready for selling would probably cost $20k. Will continue to enjoy rent/mortgage free living until I retire and move to a LCOL area (probably 2023).
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Primary residence owe $280K , paying extra principal every month(2.5% interest rate)
Investment property 1 owe $165K , paying extra principal every month(3.5% interest rate)
Investment property 2 owe $130K , paying extra principal every month(4.125% interest rate)
Investment property 3 owe $80K , used HELOC(current variable rate 2.85%)
Edited to add:
WTF? My part of this post completely disappeared. Oh, now I'll never remember the pearls of wisdom that I imparted. Gaaahhhh!
Basically, it went something like this: Sorry for the slight topic hijack, but I do not see that anyone has called you out on the strategy outlined above. Why are you prepaying the fixed mortgages (IP1 & IP2) but not the variable one (IP3)?
This seems way less than optimal. And here's a facepunch for prepaying the primary residence that's at 2.5%. Unless of course, it's not fixed.
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Back on topic: No mortgage, but sold two houses with fixed mortgages and lots of equity to buy this one. It's a clown house, but it's what our family needs at this phase of our lives.
Edited (again) to add: Since I'm in the Bay Area, here are some comparative numbers just for grins. Custom-built (not for us) house is ten years old, 2625 sf, 10k sf lot, no pool, three car garage. Paid $928k on a short sale in 2013. It's overbuilt for the neighborhood, but not obnoxiously so. We knew the appreciation would be limited because of this, but it's 3.5 blocks from DH's office. Since his mom and her pal, Al Z. Heimer, live with us, the peace of mind of having him nearby is priceless.
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I bought for $395K in 2010, with 3.5% down. The house is now worth $460K, according to Zillow, but I think it's worth $440K, based on recent sales in my area.
I now owe about $320K. I pay down the principal by one to three extra mortgage payments per year.
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Inherited a house with no mortgage on it, voted paid cash. Close enough!
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Primary residence owe $280K , paying extra principal every month(2.5% interest rate)
Investment property 1 owe $165K , paying extra principal every month(3.5% interest rate)
Investment property 2 owe $130K , paying extra principal every month(4.125% interest rate)
Investment property 3 owe $80K , used HELOC(current variable rate 2.85%)
If you are going to pay extra principal, why not focus it on either:
1) the highest interest rate (to save the most $ over time), or
2) the lowest balance (to lower the minimum payments the fastest).
Why are you spreading extra principal around instead of concentrating it?
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Nope. We own the house free and clear.
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Okey, Dokey
We need more of those MMM Californians responding!
I know the average home value around here is around $800k, worse in CA, unless you choose a condo / apartment / townhome (which is $400k-$500k). Given the massive incomes reported on other threads, and about half of us preferring to invest instead of paying off mortgage... there must be more people here with high mortgages.
? anyone?
475K left out of 625K mortgage. Put down 30%... It's San Francisco city...
Bought condo in 2012. Currently worth approx 1.9M according to Zillow.
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Another Bay Area mustachian chiming in.
Bought our house for $1,000,000
Balance on mortgage $210,000 @ 3.75%
Our mortgage is 1/4 of what we were paying for rent with our old apartment in the same area.
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Just bought a couple months ago, purchase price of $900,000, mortgage of $720,000 at 3.75%.
Also just sold our last house that we had for 4 years. We bought that one for $600,000 and sold for $875,000, though we did put some improvements in. Had $600K of equity in it, as we sent in a bunch of extra payments. I don't plan to do that this time around and just pay the minimum payment amount.
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Purchased in 2014
Purchase price: $275k
Amount down: $55k
Terms: originally 30yr at 4.6%, refie'd August 2015 to 15yr at 3.75%
Current balance: $190,688
Appraised value as of August 2015: $345k
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Purchased five years ago for about 400,000 and are sitting at about 8 grand left at this point.
I don't really pay much attention to the supposed value of the house because it's all smoke and mirrors until someone actually hands you the money for it. Supposedly, our home has appreciated in value quite a bit.
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Well I have two mortgages at the moment.
My first one is the oldest. The principal balance on it about 4 years ago was $28,500 after putting $7000+ down. It was an incredibly fortunate situation. My grandparents were looking to sell, the area was depressed, the house was in poor shape, and all they wanted was that they originally paid for it. I made out like a bandit as far as I'm concerned. At the moment the remaining balance is just over $17,000 (I got a ten year term at 3.7%). I have done extensive renovations at my own cost totalling about $30,000 and according to three independent realtors it would sell quickly at around $140,000. Judging from recent sales in the area I think they're right.
The second is far more recent. My wife and I have only been carrying this mortgage for less than a year. The principal balance was about $49,500 after putting around $2,000 down. We locked in 2.7% but this one is over a 25 year term. We haven't been paying on it very long, so the remaining balance is still up around $47,000. However we are looking to pull the pin on a sale of the first property in the next year, which pretty much renders the second mortgage inconsequential. We'll probably pay it off towards the end of our 5 year refinance period if rates rise too high, or at the very least pay it down.