Monday, January 4, 2016

Mortgage Monday: The Checks Start Now

With payment book from the bank in hand, the first of our many mortgage payments is due this week. While 30 years is a long time to be making payments at least we now find ourselves with an end date and with every payment we own a little bit more of our home. Of course, we hope that it doesn’t take us 30 years to clear this debt, at least this is the goal, so we are going to be sure to pay a little bit more each month toward principal.

Having already made an early payment it is a little disconcerting at first seeing the principal reduced by so little with every check. But, again, it is still giving us more equity each month compared to the simple evaporation of funds that we have experienced over the last several years. Now that is a disheartening number to think about. Even if your average monthly rent was $1200, over the course of five years you will have ended up paying $72,000 and have absolutely nothing to show for it. In the end, given the places that we have lived and the years that we have been renting, it is safe to say that our total is probably just north of $100,000. Seeing that principal going down by so little doesn’t seem that bad anymore.

Of course, now with us owning our home, we are also responsible for the maintenance of the house and surrounding property. A few other expenses should be expected and even with major repairs, it is still better than renting… and more cost effective given the amount of space that we now have. Each check brings us a little closer to what continues to be our goal… being debt free. While credit cards were the culprit in the past, at least now the debt is something tangible and something worthwhile.

And I will finish with this simple notion that seems to no longer be simple. While it is nice if our house increases in value over the years, all I want is the stability. If the value of the property were to stay the same I would be happy in the end. What is now seen as investment should be, once again, seen first and foremost as a home. That is how things used to be and how I view our new home. Paying interest is the price of being able to buy a home and have that stability. Our limited funds are now being applied toward a goal, something of value, and stability unlike the month to month uncertainty of the past. Now, each month, we can settle a little bit more.