Thrifty Tip: Pay Off Your Mortgage

Posted on March 30th, 2015 by Discount Debbie

house with text

My husband and I periodically dream about what it would be like to have our mortgage paid off. Can you imagine? For us, it would be like doubling our income by having our mortgage paid off. We got a great deal by refinancing a few years ago. Now, I’d love to get that mortgage paid off early. In case you’ve had similar conversations (and dreams), here are a few tips on how to pay off that mortgage early.

1. Mortgage payments. When you first buy your house, try to keep those payments at about 15 percent of your income. As I shared above, that’s not the case for us. (Maybe that’s why we are still working on it!) In any case, this is good to know when you first buy a house. The national average is 30 percent; aiming for about 15 percent of your income will give you a much better shot at paying it off early.

2. Check out bankrate.com. This site provides a tool to help you figure out various combinations of payments to pay off that mortgage early. You’ll just have to plug in the amount left on your mortgage, the amount of time you’ll like to pay it off or the extra amount you’d like to pay each month. You’ll end up finding out exactly how much extra you need to pay to pay it off in a given period of time. Check it out.

3. Divide up your payments. Rather than making one monthly payment each month, make two payments every two weeks. Because of the way the calendar is set up, you’ll end up making an extra payment without even thinking about it. That’s a great way to make a nice extra payment to move that ball down the field.

What are you doing to pay down your mortgage?


Are We Ready For A House?

Posted on February 18th, 2014 by Discount Debbie

When is the right time to buy a house? Is it when our family no longer fits into our apartment? Is it when we get that raise we have been hoping for? Do we know we can afford a house? There is a great deal to consider when getting our first home. A new house has many advantages such as stability, no pet fees, and the ability to plant a garden or hang a clothes line without breaking any rules. Houses can however have drawbacks when we aren’t prepared financially for them.

Rent Vs. Mortgage 

First is the most important bill that comes with any home. Yes, there are many things to worry about when buying a home. There are legal fees, down payments, and inspections. Many people forget that. While huge, these are only one time payments. The real question is can we afford to live in this home month to month? What is the cost of being able to stay there? Is our rent price higher than it would be to pay a monthly mortgage on our home? If rent costs less, is it really worth getting a new home right now?

Other Bills

Right now we are apartment dwellers that have never owned our own home. I couldn’t tell you who I needed to call to have our trash collected or even if there is such a person. While some of our bills would be the same, we would be adding others. There would be home owner’s insurance, water, and trash. These are also added to our monthly costs and need to be considered. And let’s not forget property taxes. Yikes!

Appliances

Let’s say we have considered everything above. We have got the house and are moving in. This is not the time to remember that the house didn’t come with a stove or a fridge.  Many houses don’t, but as seasoned apartment dwellers it wasn’t something we thought of until later when looking for a home. Some homes come with a few appliances included. We could also buy used appliances from the Salvation Army or Craigslist. In a pinch, I suppose that we could even settle for shopping for meat daily and using a hot plate and BBQ to cook. It may work for a while. At least it’s a plan.

The House

Last but not least let’s mention the house. I have heard of others that buy a nice fixer upper, only to discover that they couldn’t live in it while it’s being fixed up. There are also times when the cost of the home repairs comes as a shock.  The best advice we got was always have a repair appraisal and inspections. Determine what we could fix ourselves (realistically) and go from there. That fixer upper may need to be passed up for a better opportunity. And even the best of houses will need maintenance. No more on call repair man when you own your own home. You’re now you’re own repair man, or you may have to hire one.


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