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Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
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Quote:
Originally Posted by galaxyhi
Unless you paid cash for your house, you probably have some sort of mortgage.
Ours was a 30 year fixed at 3.875%, ....
How long will it take you to pay it off if you haven't?
At 3.875% I will NEVER have my mortgage paid off, unless commercial rates go to 30 yr term @ <5%
My mortgage is my BANK and a MUCH more secure / stable one that the one on the corner! (Who can CALL your commercial loans due at any minute, and who LOVES to renegotiate terms and add fees every 5 yrs)
Over the last 40 yrs, my mortgages have enabled millions of dollars in transactions. and well over a million $ in gains.
While costly, I do not consider a mortgage evil... just another tool in the box.
We each use our tools differently, BUT... I prefer to have a FULL toolbox than an EMPTY one.
Stuff happens, job loss or economic change could leave me hanging and very vulnerable w/o a mortgage. If you have a good one.... and you use it to your advantage THAT can be a very good thing.
When the banks called all the commercial paper DUE in 2008... I considered THAT evil! People who had never defaulted in 50+ yrs were raped of trillions in equity. That is EVIL. be prepared, keep your tool box well equipped.
On the website when I pay my mortgage, there are spaces for adding $$ to pay to principal or to interest. I am sure all of them feature something like that.
As a matter of fact, my PITI, insurance, and taxes come to $1459. I round up to $1500 and put the extra toward principal. Not much, but it's something and it works for me psychologically.
Yes, my coupon has a space for Extra principal payments.
Besides chunks of extra principal payment,s I started doing that the first payment. I rounded up to the next $100. Like you said, it's not much, but it's something, like the guy selling insurance on TV who saves is pennies in a jar and that pays for his life insurance. Now, unless I am sending a chunk of money towards principal, I round up to the nearest $1000.
And yes it works well psychologically to know you are paying it down faster.
and using your case if you can't afford that extra $41/m then you probably should NOT have qualified for a mortgage to begin with.
I like having it paid off sooner than later.
Amen.
I used to take one extra payment and divide that by 12 and add that to each month's payment. A few months ago, I did a re-fi into a 20 year loan (about 18 months into a 30 year), so for right now, that payment is including the extra I kicked in, but I'll start throwing in a little extra again at some point once I'm not still paying for all the extras that come when you buy new construction.
I'm not super worried about having my mortgage completely paid off when I retire, although it would be nice, but I plan to sell and downsize so even if I have a small amount left on the mortgage, I'll still have more than enough to pay cash for something smaller, as well as get some additional cash back to boost my savings at that point.
I used to take one extra payment and divide that by 12 and add that to each month's payment. A few months ago, I did a re-fi into a 20 year loan (about 18 months into a 30 year), so for right now, that payment is including the extra I kicked in, but I'll start throwing in a little extra again at some point once I'm not still paying for all the extras that come when you buy new construction.
I'm not super worried about having my mortgage completely paid off when I retire, although it would be nice, but I plan to sell and downsize so even if I have a small amount left on the mortgage, I'll still have more than enough to pay cash for something smaller, as well as get some additional cash back to boost my savings at that point.
We went with a 30-year mortgage to get our minimum payment lower [on each of our properties].
Once we got into our first property, we looked at how much 360 payments add up to as a liability against our net worth. We played with the math, using principal-only payments of $50, $100, and $200. They can make a huge difference on net worth of income property. We went with $200 as our appropriate level of payment to be making.
That allowed me to retire fairly young with no debts.
Yes, my coupon has a space for Extra principal payments.
Besides chunks of extra principal payment,s I started doing that the first payment. I rounded up to the next $100. Like you said, it's not much, but it's something, like the guy selling insurance on TV who saves is pennies in a jar and that pays for his life insurance. Now, unless I am sending a chunk of money towards principal, I round up to the nearest $1000.
And yes it works well psychologically to know you are paying it down faster.
and using your case if you can't afford that extra $41/m then you probably should NOT have qualified for a mortgage to begin with.
I like having it paid off sooner than later.
Amen.
Eventually I will make larger extra payments, but I have something higher-interest to pay off first. Then my mortgage will be my only debt and I will whack it harder.
We took out our first mortgage as a 30yr fixed at 3.875% back in April 2012. In 2016, we spent $450 to refinance it to another 30 yr fixed at 3.5%. Our payments are $320 less each month as a result; 1/3rd of which in part as a rate reduction and the other 2/3rds because we reset the loan for another 30 years.
I'll consider refinancing to a 15yr fixed if rates go below 3% after 2027…there are other things I'd rather do with the money before then.
Not that I feel one way or the other, but I assume you mean that its better to simply pay scheduled amount and not make additional payments?
Its a thought. Would the amount saved on interest paid be the equivalent to the dollar value of 2047 dollars?
No, not in general. You have to run the numbers for yourself.
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THAT can be a very good thing.
People who had never defaulted in 50+ yrs were raped of trillions in equity. That is EVIL. be prepared, keep your tool box well equipped. 
1. No, it doesn't, and 2. How would YOU know anyway?
