Paying off Mortgage Early ?s

**AveryMadison'sMommy** · 04-19-2007, 03:05 PM

Hi everyone!
DH and I would like to pay off our mortgage as quickly as possible. We owe $106k at 5.875%. (started at $110k) We built our home two years ago after DH's grandparents were kind enough to give us 5 acres of land. We used that as collateral so we don't have PMI.

I have been looking for a website to find out what extra amount we would need to pay per month to pay it off in 5 years. Can anyone help me out there? Is this even doable or is it a pipe dream? We are young, DH is 26, I will be 24 in May. We have a 1 yo DD whom I just quit my job to SAH with. Needless to say $ is a little tight, but I want this mortgage PAID!

So, any pointers, websites, etc?! Please help me get this thing paid!

Thanks!
Brie

**mommy4ever** · 04-19-2007, 03:17 PM

http://www.cibc.com/ca/mortgages/art...free-fast.html

it's at a Canadian site, but it's a free calculator you can use. Just set amortization to 5 years, enter amount owed and %.

**mommy4ever** · 04-19-2007, 03:18 PM

Oh, just watch, there are limits as to how much you can prepay. Our mortgage is 15%.

**FrugalMomof3** · 04-19-2007, 03:26 PM

I would go to www.bankrate.com and look up their mortgage calculators, I use them all the time. I too want to pay extra on my mortgage and get it out of the way so the only bills I would have would be utilities, homeowners and taxes, gosh that would be great!

Through the advice of the ladies here, first is the EF, then the 3-6 months of living expenses then retirement then pay on the mortgage. I plan to do the retirement and mortgage in one step, the more I can put on the mortgage the better, just think of the financial freedom WE would have only worrying about normal things (mentioned above) and all that extra money to put into retirement.

My DH is 44 and I am 34, if we would pay off our mortgage in 10 years instead of 30 that would be great, I wish we could pay it off in 5 but that's dreaming right now.

**AveryMadison'sMommy** · 04-19-2007, 03:32 PM

I'm sure I'm dreaming as well, but one can dream, right?

We have some $ put away already for EF and about 3 months of living expenses. We have a truck that we bought (stupidly) and are trying to sell so we don't have that payment and other than that our only debt is the house.

I am trying to start "babysitting" so I can make some $. I am already tending to my neighbors son and have a baby that I will start tending after August (due to be born in May) so that will provide some income. I just dream of the freedom we will have when we don't have a mortgage!!!!

**FrugalMomof3** · 04-19-2007, 03:50 PM

I totally know what you mean, I dont want a mortgage, some say the interest you pay is great at tax time but that never works out for us, we wind up taking the standard deductible anyways.

I say if you want to get it paid off you will, I am actually going to skip the saving for college and do the retirment AFTER the mortgage is paid off, since we are young even paying the house off in 10 years, still gives us over 10 more years to save for retirement but no mortgage payments thus giving us the opportunity to save more that we could at present. KWIM?

I really want to get the mortgage out of the way, thinking of 28 more years going down to 10, is awesome! You and I both know once we got down to the last final 2-3 years we would most likely add in more money to get that even over with faster to possibly 1.5 years or less.

**AveryMadison'sMommy** · 04-19-2007, 04:13 PM

I completely agree!!! We had a little debt earlier this year, but the tax man was good to us and we paid it all off!! Yippeee!

I can't stand thinking about paying for my house for 28 more years! Ugh. And not to mention when it's payed for at that rate, it will probably need major updating/renovating! No thanks...I'd rather pay it NOW!

PS: Tracy- how on earth do you spend so little on groceries? Do you have a thread or something somewhere with meal ideas/recipes? You sound like you're on top of things!

**FrugalMomof3** · 04-19-2007, 04:22 PM

Brie,

You can check my blog out, it's in my signature below

As for the mortgage I would must rather get that out of the way in 10 years, the concentrate on my future i.e. retirement. I love DR but the way he has things to me seem all out of whack....

EF $500-$1000 OK, 3-6 months of living expenses OK, Snowball Debt OK, but then college (we wont do this because we have 7 kids, no way we could save for all AND since there are 2 already out of college, 1 went and paid for herself, 1 didnt and has a kid already and is getting married next month, 3 are graduating for HS this year, 2 from Technical HS and 1 from HS doing College Prep and only 1 is going to College that is my DS, he knows we cannot afford to fund his college but he has gotten tons of grants, etc... now my DD is 11, she wants to be a Vet. (right now) and already knows now at a young age we cannot afford to fund her college education and wouldnt be fair to the other 6 if we did). So we skip College Funding and want to WAIT to do retirment but go to Mortgage and get that baby out of the way, for us it's easier said than done but even putting $200-$250 every month towards the mortgage knocks off a bunch of years and interest too! Once the Mortgage is paid off, then we will start Retirement. I have spoken to DH and he agrees.

**mommy4ever** · 04-19-2007, 04:28 PM

I'm in agreement. Lets pay off the mortgage it's the biggest debt anyone ever has, and the way things are amortized, you end up paying double what you mortgaged it. Let's face it when you pay more interest than principal each month..lol. There's no way any tax benefit will off set the tens of thousands in interest you pay over the life of the mortgage.

4 years ago we had 23 year on our mortgage left. We changed it to pay every 2 weeks, and added an extra $100 per payment, it brought it down to 13 years! Now I'm working it hard to get rid of the debt, as you can see, we're in a fine pickle, but I'm devoted, and when that is done, I've decided to take advantage of changing the payments to double the payment, AND work on paying extra at every chance. Ironically, doing this means the mortgage could hypothetically be done in 3 years!(well, 2.5). Then at 36 and 40, we could bank SOOO much $$ toward everything! We could max out both our retirement funds in 2 years after that(rrsp) and then I'd need to research what else we can do for retirment..lol. College for ds would be covered easily, as he'd graduate 2 years after the mortgage is done, and the rest of the little ones, well the youngest would be 6, so lots of time, the others 11 and 13, so still lots of time!

**FrugalMomof3** · 04-19-2007, 04:52 PM

I am glad I am not the only one thinking like this, while like I said, I love DR and his way of doing things I personally would like the BIG debt out of the way as soon as possible it's what holds most of us back from other bigger and better things.... like our Future!

Think about it... mortgage payments at $650 + adding the additional $300 = $950 total per month in your pocketbook/bank account has AFTER it's paid off, that's a nice lump sum to distribute to your IRA/Retirement Accounts each month. (When I said mortgage payment I only meant the mortgage payment and NOT the escrow for taxes/insurance). I mean seriously think about it! Who want to pay $650 + escrow NOW for the next 28 years when if we put just $300 more per month ($950) we could knock off over 10 years! AND if we are really good we could add a little more here and there and when tax time comes take half your tax refund and apply it to the mortgage knocking 2-3 more years off! I love it! I think DR and any other financial gurus should pat us on the back for wanting to totally get out of debt (I mean paying off the mortgage is AFTER paying off all CC's/student loans/car notes).

I actually get excited thinking wow at the age of 44 I will have tons of equity, not have any loans, not have any CC debt and the money that comes in will be able to be saved after paying normal bills and setting aside for taxes & homeowners, what a relief that would be, no rocks on my shoulders, no crying wondering how are we going to pay this or that, no worrying about using the CC for $100 and thinking "Gosh! How am I going to pay that back?" we wouldnt have to worry. Atleast that is how I think.

**kksmom92** · 04-19-2007, 06:40 PM

We also are trying to pay off our house ASAP and thankfully that is our only debt we have. Every month we put something extra on it. This year we are trying to put enough extra with it so we will knock off $1000 each month.

We borrowed $130k March 30th 2001 and our goal for this year is to get it down to $39,999 and have it paid off by Dec 2009!

We also think like you Tracy... lets get this house paid off first and then start putting money in our retirement fund.

**frugalfriend** · 04-19-2007, 07:33 PM

We're in the same boat wanting to get the mortgage taken care of then work on retirement. We have small IRA's started awhile back for retirement but need to start contributing regularly since DH is self-employed. No 401K here! If we can sell this house we will be able to pay off the mortgage and buy another house outright.
Woo hoo!

No more mortgage payment would be a Godsend!

**FrugalMomof3** · 04-19-2007, 07:39 PM

I totally cant wait for the moment we are mortgage free! My DH said to me today, you know we "want" to put that $300 towards mortgage but the question is "will we"? I figure that's $150 a paycheck per month, we would have normally paid out in CS each paycheck $287.30, we woul still have $137.30 extra to save for car insurance or oil for the oil tank. It's still MORE than we've had in over 16 years!

We have to think about REALLY REALLY wanting it, then doing it, once we start doing it, it will feel great!

**banana** · 04-20-2007, 07:53 AM

We are also in the process of trying to pay off our mortgage early. We took out a 30 year mortgage in 2002, switched to a 15 year in 2004. Started with a mortgage of 117,000, now we are at $91,289.08.

I am hoping to put an extra 200-300 per month towards the principal when we have the extra money to do that. I would love to have it paid in full by 2015.

**TheRootedNomad** · 04-20-2007, 08:35 AM

We're also shooting to pay off our morgage early. This is a relatively new frame of mind for us in some ways. Until about two years ago we just kept attempting to get on the right financial path but we continuously got sucked into the easy credit pits when things would get tough. About two years ago we decided "no more debt no matter what" and we slowly dug our way out from under everything but the morgage. Last August we were able to turn our attention to the morgage. We refinanced from a 30 year to a 15 year fixed at 5.75% and started throwing lots of extra at the morgage. It was really motivating.

Then the new year hit and things keep popping up

so we haven't been able to make much progress. I'm hopeing next month will be when we can get back on track. We're also following a modified version of DR as his order doesn't fit our life either.