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Deciding when to pay off the house


Dirtyhip

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If I ramp things up, it could happen very quickly.  The payment is comfortable, so could let it ride.  It seems that the great satisfaction of having no debtors would be rad.

I know there are people here who have zero debt.  Do you have any regrets to owning your home outright? 

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13 minutes ago, Dirtyhip said:

If I ramp things up, it could happen very quickly.  The payment is comfortable, so could let it ride.  It seems that the great satisfaction of having no debtors would be rad.

I know there are people here who have zero debt.  Do you have any regrets to owning your home outright? 

Comfort provides little gain.  Pay it off and use your money in other investments. 

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15 minutes ago, RalphWaldoMooseworth said:

In NJ it still feels like I am renting with $600/month in property tax. :angry:

Yeah.  That.  We will be sitting at around 200 a month for taxes and insurance.

How big is your home?

13 minutes ago, Wilbur said:

Comfort provides little gain.  Pay it off and use your money in other investments. 

There will emergency funds mostly unscathed in this plan.  

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No. Having it paid off is very nice.

Two big questions: (1) What is your interest rate, and (2) are you still using it for a tax deduction?

If you are paying a higher interest rate on things like a credit card, car loan, school loans, or your massive LBS payment :D plus using the home loan as a tax deduction, you may be better paying all other loans first. That's what we did.

However if you don't have much in the way of other loans or are already taking the standard deduction, then pay off the house.

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5 minutes ago, JerrySTL said:

No. Having it paid off is very nice.

Two big questions: (1) What is your interest rate, and (2) are you still using it for a tax deduction?

If you are paying a higher interest rate on things like a credit card, car loan, school loans, or your massive LBS payment :D plus using the home loan as a tax deduction, you may be better paying all other loans first. That's what we did.

However if you don't have much in the way of other loans or are already taking the standard deduction, then pay off the house.

This is Hip you are talking to!

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8 minutes ago, JerrySTL said:

No. Having it paid off is very nice.

Two big questions: (1) What is your interest rate, and (2) are you still using it for a tax deduction?

If you are paying a higher interest rate on things like a credit card, car loan, school loans, or your massive LBS payment :D plus using the home loan as a tax deduction, you may be better paying all other loans first. That's what we did.

However if you don't have much in the way of other loans or are already taking the standard deduction, then pay off the house.

Oh yeah, you all get tax relief.  We don't on a mortgage unless you borrowed for business purposes.  Listen to Jerry. 

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1 minute ago, JerrySTL said:

No. Having it paid off is very nice.

Two big questions: (1) What is your interest rate, and (2) are you still using it for a tax deduction?

If you are paying a higher interest rate on things like a credit card, car loan, school loans, or your massive LBS payment :D plus using the home loan as a tax deduction, you may be better paying all other loans first. That's what we did.

However if you don't have much in the way of other loans or are already taking the standard deduction, then pay off the house.

Interest rate is above 4.  The tax deduction we are getting from it, is bullshit money, really. We're pretty screwed with our taxes.  There just isn't much to write off, these days. 

They pay us to use the shit out of the credit cards. We pay no interest, on cards, ever.  Our balance at the shop is about $50, I think. :P.  

No standard deductions, when you have rental property. We do several tax forms.  

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I financed 260k, put 50 down. 2.49% 30y fixed. We put an additional $7-10k at the end of each year as principal only payments. Our 30yr should be paid off in 16 (about 10 to go). We have two car payments but both are at either 1% or under so we don't worry paying off soon. Never have any credit from revolving lines, balances paid in full each month.

Only money that's really debt is my student loans but I went private instead of FSA. Best part is interest is on balance 1 year after graduation. I've been putting roughly 60-70% of each semester in 1yr Muni bonds and AMT bonds. That way instead of paying them interest I am making interest on my money and when I graduate I'll pay balance in full. Projected growth right now has me at 92% funded and I have one year to go.

Debt isn't a big thing if you apply sense to making cents and allow interest to work for you.

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4 minutes ago, goldendesign said:

I financed 260k, put 50 down. 2.49% 30y fixed. We put an additional $7-10k at the end of each year as principal only payments. Our 30yr should be paid off in 16 (about 10 to go). We have two car payments but both are at either 1% or under so we don't worry paying off soon. Never have any credit from revolving lines, balances paid in full each month.

Only money that's really debt is my student loans but I went private instead of FSA. Best part is interest is on balance 1 year after graduation. I've been putting roughly 60-70% of each semester in 1yr Muni bonds and AMT bonds. That way instead of paying them interest I am making interest on my money and when I graduate I'll pay balance in full. Projected growth right now has me at 92% funded and I have one year to go.

Debt isn't a big thing if you apply sense to making cents and allow interest to work for you.

Very smart.

I've been paying extra since this loan started.  We were paying massive extra payments in the beginning.  Then, I slowed and screwed off a bit.  

Our homes are way less expensive and more modest than what most of the people are rocking here.  I think there are more professionals here compared to us. I am a lower paid worker.  :D

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Just now, Dirtyhip said:

Very smart.

I've been paying extra since this loan started.  We were paying massive extra payments in the beginning.  Then, I slowed and screwed off a bit.  

Our homes are way less expensive and more modest than what most of the people are rocking here.  I think there are more professionals here compared to us. I am a lower paid worker.  :D

Both my wife and I combined make about what most of our friends whom are engineers and other higher paid professional positions. Yet we always end up doing things they think is "so expensive! We can't afford that!" Thing is we are frugal in a lot of ways and choose to spend our monies elsewhere.

I don't have cable, pay for any subscriptions except Amazon and that practically pays for itself in savings. We've had this house for 5 years, I just furnished the living room last year, dining the year before, the guest rooms where lucky craigslist finds. I don't go cheap, but I wait until the price is right and the item is exactly what we want. So if that means using my hand me down parents couch until I was 30? Pfft. I did it. 

Our only real splurge is two nice dinners out a week and one largish vacation followed by a 3-4 day getaway too. Oh and tickets to sports games always seem to be on the budget.

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Two nice dinners? You're forgetting someone. LOL

we have Netflix as our tv splurge. it ' s well worth it for all the stupid slapstick comedy that I watch. we drive an older truck and keep repairing it, mostly ride bikes to work, we rarely eat out, vacations are biking ones as we pretend we are homeless down by a river. Our biggest spending problem is the bikes. Oh... the bikes. Although, my bro deal may fade when we move. Unless, I can whore my way in with the bike shop, or the shuttle company.  my needs concern me. Especially riding in wetter weather. I am going to burn through stanchions, bearings and whatnot.

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A guy at work, 40 something, lived with his parents his whole life. Very shy, kinda scared of women. Works every minute they let him. Pays cash for everything, so no credit rating.

Well he decided to buy a house, just down the road from the folks, so he could keep an on Mom. (He is a hell of a nice guy)

Went through the whole mortgage process, I guess to see how it works.

Made 2 mortgage payments, decided he didn't  like doing that and payed off the house. Around 140,000. 

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I don't mind making a house payment. It's the only debt we have and it's a lot less than rent. The interest rate is low and we use our money to bless people and charitable giving. If we would have put our charitable giving into our house it would have been paid off many years ago but that is not where our priorities are.

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Nothing wrong with sensible debt.  I still have a mortgage for another 7 or 8 years.  The only additional principle I pay is the 1% kickback from my VISA card (it's already knocked a few years off).  I could liquidate some things and pay off the house, but my interest rate is lower than what my investments return, so any additional money gets invested.

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