Last Friday I paid off the mortgage as part of our 2015 plan to be debt free. Next step is to pay off the home equity loan and two cars. Everything is scheduled to be paid off by then but by making principle only payments we are managing to get there a little early.
My husband and I ‘started over’ 9 years ago with basically nothing – both of us previously married and otherwise burdened. It feels really good to see light at the end of the tunnel now and soon to have no debt at all!!
Location: Northern Zone, Costa Rica - 200 to 300 meters Tropical Humid Rainforest
posted 8 years ago
Isn't it a great feeling?! Our company and our selves run debt free, with money in the bank. It took me a while to understand just how powerful that is. First of all, my profit doesn't go to the bank, secondly, if there is a dip in the economy, we just scale back and life goes on, we aren't at risk of losing everything because we can't make payments.
Also, to add to this, when we get some extra money, we don't have to use it to pay down debt...
Sustainable Plantations and Agroforestry in Costa Rica
Jeanine Gurley wrote:Last Friday I paid off the mortgage as part of our 2015 plan to be debt free. Next step is to pay off the home equity loan and two cars.
Hi Jeanine, that is great news.
Forgive my ignorance, but what's the difference between a mortgage and a home equity loan?
Down under we "redraw" on our mortgages when we need to borrow against the equity in our houses (assuming that you are 'ahead of the curve' and have paid more in earlier that you can then redraw if you need it).
Jeanine Gurley Jacildone
Location: Midlands, South Carolina Zone 7b/8a
posted 8 years ago
Phil, same thing - just the home equity loan is a separate loan from the mortgage. It is commonly encouraged that you borrow against the equity in your house if you need money and I have done that to fix up our house - it was a very old house in need of lots of stuff. BUT --- I have since learned that it is better, in my opinion, to have automobiles that hold thier value well and borrow against them if there is any crisis that requires that I borrow. Then if things get desperate they can come take a car - not my house. I can ride a bike if need be but I don't care to sleep in my car. And I do have three bicycles, a scooter and a motorcycle .
Excellent news - congratulations! We became mortgage-free about two years ago. Debt is slavery.
(I once compared the amount I paid each month to the bank to the number of fruittrees I could buy for the same cash and was astounded. $750 a month pretty much buys you a nice orchard's worth in a couple months.)
Seed the Mind, Harvest Ideas.
posted 8 years ago
Feels good to get out from under the house payment. I paid ours off last year. Paid the car off then my father in law passed and I took his truck debt. Put that on the home improvement loan, figuring if I had to pay intrest it might as well be deductible. LOL The truck is a 2010 and the payment is $105.00 mo. Not bad for a new car payment. Now I'm balancing 2 homes, both paid for. Mine here has taxes of $5,000.00k yr. In Georgia they are $1,000.00. Not apples to apples as the homes go. Me thinks the expensive one might have to go. God willing, and if the karma is good it will be in less than a year.
Alright! This is my kind of subject. I agree, debt is very close to slavery. Close but not exactly since you have some choice in the matter.
I bought a condo (back in 1998 ) rather than bankrupting myself on a house and paid it off in 11 years with only a little extra effort. That mortgage was my last debt and that dropped my usual spending to about 30% of my take home pay. Now later this month I close on a house that's 15 miles from work and has a half acre lot that's awesome for urban permaculture (including a gentle slope facing west). My plan is to rent out the two extra bedrooms in the house, using some of the ideas I got from Paul's experience in the green lake house. Got one of the rooms rented already. I'll also rent the condo out, as soon as I can give it a little paint. The condo rent should cover about 60% of the house mortgage and the two room rentals will cover the remaining 40%. That will drop my usual spending to about 25% of my after tax income, leaving a lot of extra financial power that I can use to payoff the house faster. I consulted an amortazatin tool online and with a bit of effort it looks like I can knock that mortgage to zero in 5 or 6 years. I'll be 52 or 53 by then, increasing the possibility of an early retirement.
During the the next 5 years I want to move the half acre lot into a permaculture system that's beautiful as well as well as productive. I hope to provide an inexpensive and healthy living experience for my roommates (in return for their very modest rent). I hope to create a place where they can unwind and recharge from the day's efforts. A place of beauty and comfort that produces nutrient dense food (which will of course be shared as an additional perk for living there). I might even be able to arrange a guest spot where my fellow permaculture people from out of town can kick back in while attending conferences or convergences in this area.
It should be fun and I can't wait to get started.