Torrez Family Mortgage Pay Off

Discussion in 'Mortgage Payoff Diaries' started by MTorrez, Jan 5, 2018.

  1. MTorrez

    MTorrez New Member

    Joined:
    Jan 5, 2018
    Messages:
    1
    Likes Received:
    1
    Mortgage Debt:
    $163368
    Interest Saved:
    $101292
    Principal Pre-Paid:
    $111000
    Hello Everyone! It is nice to find a group of people as "crazy" as me, and supportive of each other as we work to get rid of the "good" debt. My wife and I bought our house in CA in 2010 with a 30 year fixed mortgage of $348K at 5% interest. It is a modest home 3 bed 1 bath, 1100 sqft in a nice area. We had put down 20% at the time and I hoped to one day remodel it, but with what felt like a ginormous mortgage I thought that might never happen. I reassured myself that in a worst case scenario, the last family that owned the home had raised 2 kids with 1 bathroom and that although not perfect it was doable if we had to. I continue to live in fear of a mass stomach virus outbreak in the Torrez home.

    Then my wife told me about some guy on the radio that was giving a lot of financial advice that sounded like the same things we did. So I tuned into the Dave Ramsey show and was instantly a fan. We had always been pretty conservative, live on less than we make, no college debt, cash flow expenses, have an emergency fund and conserve our "saving power"; but it was when I heard people talking about their paid off homes that I was reinvigorated that we could get there. I instant started and finished our debt snowball paying off the monthly balance on our credit card, as I did every month, except this time it was the last time. It was a little anticlimactic compared to other debt free stories and screams I heard on the radio, but it was a start.

    Unfortunately we still had some large expenses to save for before we could really dig into the mortgage, finish cash flowing my wife's masters/ special education credential, replace the 3 layers of roof on our house before El Nino made us pay for it, along with an AC unit that may have been older than me at the time, a new used car, and a new baby girl. Last but certainly not least was the $24K needed to pay down the mortgage to refinance to a new 30 year fixed rate @ 3.25% (New mortgage of $314K), since the house had lost value since we bought it in 2010 (refinanced at the end of 2012).

    The refinance lowered our mortgage payment by ~$500/mo, which was very fortunate because a year after our daughter was born my wife really wanted to stay home for a few years with our daughter. It made sense since we planned to have another child and child care cost would eat most of her take home pay.

    It seemed like forever but finally near the end of 2014 we made our first principal curtailment payment of $1,000 and it felt really good. We kept at it, $1,000 here, $1,500 here, $3,000 there, then due to a lot of forced overtime and a super bonus we dropped $25K and it felt truly awesome.

    We broke thru the $300K mark, and continued to keep plugging away. In April of 2016 my son was born and I reworked the monthly budget to save more for college. In 2017 we broke thru the $200K marker. This year we hope to break thru $150K and by 2020 we hope to have the house paid for, if not sooner. Today we stand at a mortgage balance of $163K.

    I find the hardest part of starting the Dave Ramsey's baby steps with very little debt is you don't get the benefit of smaller psychological wins to help motivate you for the longer haul it takes to pay off your mortgage. I made a mortgage debt thermometer to help motivate us, and then a mortgage grid countdown when it took to long to get a notch on the thermometer. I try to listen to Dave Ramsey show podcasts, read books and articles, track our household net worth, plan future family vacations and do hypothetical budgets for life after a mortgage to help stay motivated. I have had to learn to live a little more and try to balance having a little fun now and not sacrifice so much I "lose my team."

    Like many of you I get strange looks and chastisement from coworkers and friends when I tell them I am paying off the mortgage and giving up that tax benefit. So, I felt blessed to find this group, and look forward to counting down with everyone else as we ditch Fannie Mae or Freddie Mac. Happy New Year! I hope it is a prosperous year for all of us.
     
    Last edited: Jan 5, 2018
    cdub likes this.

Share This Page