We are officially mortgage-free!

[Anonymous]

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Having a mortgage are for people who can’t afford to pay cash. See how that works.

[Anonymous]

Anonymous wrote:The total interest on my loan added to purchase price would mean 30 years after I bought it, I’d need to be able to sell it for 25% more than I paid. Right now it’s sitting around +30-40% 5 years in.

Inflation adjusted I’m paying about 1000 more month PITI than what my rent was for 700 sf 1 bedroom 16 years ago.

My income has gone up by over 10x in that span.

If we are going to celebrate the people who borrowed and couldn’t wait to get out from under it because it was such a strain, we should also celebrate the people who have used leverage effectively to build wealth while staying well within their means.

Fine, go start your own thread celebrating that. No one is stopping you. But you folks never do that because what you really want to do is smugly assert to those of us who hate debt that your way is superior.

[Anonymous]

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Wrong. It makes total sense to get rid of your mortgage before retiring. My mortgage was about $1,700/month, or $20,000 per year.

According to the 4% rule, I would have needed $500,000 in assets in retirement just to cover that mortgage. But the mortgage balance itself was only $300,000, so I needed a lower nest egg to retire if I paid off the mortgage.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Having a mortgage are for people who can’t afford to pay cash. See how that works.

And for people who can afford to pay cash but know how money works. I have a 2 percent mortgage. Tell me where I can get money that cheap elsewhere. They money I would have used to pay the mortgage off is making so much more than that. It would be idiotic to take the money that is making money to pay off a debt that is costing less. Knowing this is the difference between being able to accumulate actual wealth and just feeling like you are making do.

[Anonymous]

Anonymous wrote:Congratulations!

Just curious how much are you still paying in taxes and insurance.

I remember my dad once saying that was more than his original mortgage “once his was paid off”…, and what was your original mortgage payment.

OP here.

We had a 15 year mortgage at $3K a month. Our insurance and property taxes are around 1K a month.

[Anonymous]

Anonymous wrote:

Anonymous wrote:The total interest on my loan added to purchase price would mean 30 years after I bought it, I’d need to be able to sell it for 25% more than I paid. Right now it’s sitting around +30-40% 5 years in.

Inflation adjusted I’m paying about 1000 more month PITI than what my rent was for 700 sf 1 bedroom 16 years ago.

My income has gone up by over 10x in that span.

If we are going to celebrate the people who borrowed and couldn’t wait to get out from under it because it was such a strain, we should also celebrate the people who have used leverage effectively to build wealth while staying well within their means.

Fine, go start your own thread celebrating that. No one is stopping you. But you folks never do that because what you really want to do is smugly assert to those of us who hate debt that your way is superior.

It’s been the objectively superior approach and we’re trying to warn others not to make the same mistakes. Who cares about debt when you can pay it off at any time. The bottom line is your net worth and your financial flexibility. Paying down your low interest rate mortgage hurts your net worth and gives you less flexibility. And you still have to pay taxes and insurance regardless so your payment isn’t gone.

Paying down a low interest rate mortgage goes against all basic fundamental financial principals/advice. People that ignored that elementary advice over the last 15 years left a ton only money on the table. It’s a warning to others not to take the same mistakes going forward…

[Anonymous]

Math. Guys. It is math. It is a shame that our educational system doesn't explain this better and keeps you all poor while you do what you think is "right."

IT IS STUPID TO PAY OFF A MORTGAGE in most instances. But if you really can't handle money or finances and you prefer to just think you are okay instead of using your money wisely, go for it. Just know that when you brag about it, the smart people around you will all think you are stupid and bad with money.

[Anonymous]

"In most instances." If you have spent 30 years paying it off and you somehow forgot to refinance when interest was low (???), then sure go ahead and finish paying it.

But your wealth has absolutely nothing to do with it, other than if you are just saying, I'm so wealthy that I am fine making stupid decisions with my money. Okay. I'm in that bracket, as are most of my friends, and the reason we are there is because we don't make stupid financial decisions. This isn't even a fun waste of money. It is just poor handling of money.

[Anonymous]

Anonymous wrote:"In most instances." If you have spent 30 years paying it off and you somehow forgot to refinance when interest was low (???), then sure go ahead and finish paying it.

But your wealth has absolutely nothing to do with it, other than if you are just saying, I'm so wealthy that I am fine making stupid decisions with my money. Okay. I'm in that bracket, as are most of my friends, and the reason we are there is because we don't make stupid financial decisions. This isn't even a fun waste of money. It is just poor handling of money.

Go away troll. If you're here just to claim you're smarter than everyone else, and make better financial decisions, then you're dumber than you think

[Anonymous]

Imagine you had refinanced just say $500k during the pandemic when interest was low. If you had invested in 2020 in the S&P500, it would now be $889k. Why would you leave almost $400k on the table? Just so you could brag that you are so rich that it made you stupid?

[Anonymous]

Anonymous wrote:

Anonymous wrote:"In most instances." If you have spent 30 years paying it off and you somehow forgot to refinance when interest was low (???), then sure go ahead and finish paying it.

But your wealth has absolutely nothing to do with it, other than if you are just saying, I'm so wealthy that I am fine making stupid decisions with my money. Okay. I'm in that bracket, as are most of my friends, and the reason we are there is because we don't make stupid financial decisions. This isn't even a fun waste of money. It is just poor handling of money.

Go away troll. If you're here just to claim you're smarter than everyone else, and make better financial decisions, then you're dumber than you think

Nope. My goal is to make people understand that these types of decisions are why they are not accumulating wealth. You are trying to keep people poor

[Anonymous]

Anonymous wrote:

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Wrong. It makes total sense to get rid of your mortgage before retiring. My mortgage was about $1,700/month, or $20,000 per year.

According to the 4% rule, I would have needed $500,000 in assets in retirement just to cover that mortgage. But the mortgage balance itself was only $300,000, so I needed a lower nest egg to retire if I paid off the mortgage.

You just laid out a compelling “trouble affording it” scenario.

[Anonymous]

Anonymous wrote:

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Having a mortgage are for people who can’t afford to pay cash. See how that works.

If by “paying cash” you mean using money from debt that is secured by other assets… sure. I don’t think anyone here is confusing types of debt. They think it’s silly/reckless to take out debt to purchase a home and it’s debt that you simply must retire as soon as humanly possible as both a virtue and a matter of life or death personal finance.

[Anonymous]

Anonymous wrote:Imagine you had refinanced just say $500k during the pandemic when interest was low. If you had invested in 2020 in the S&P500, it would now be $889k. Why would you leave almost $400k on the table? Just so you could brag that you are so rich that it made you stupid?

Let's use the 15 year number, as the OP has lost the use of that cheap money for 15 years by doing a 15 year mortgage instead of a 30 year mortgage. It is easier to use historical data, so lets say that the OP did this in 2015. They had saved the cash to pay off the mortgage, but instead put the $500k in the stock market. Today it would be OVER THREE MILLION DOLLARS. If you are too rich to care about that, you really should be hiring a better finance guy that can help you out so you don't keep wiping your butt with cash.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Hating mortgages are for people who have trouble affording theirs.

Having a mortgage are for people who can’t afford to pay cash. See how that works.

If by “paying cash” you mean using money from debt that is secured by other assets… sure. I don’t think anyone here is confusing types of debt. They think it’s silly/reckless to take out debt to purchase a home and it’s debt that you simply must retire as soon as humanly possible as both a virtue and a matter of life or death personal finance.

It is reckless not to take out a debt if the debt is almost certainly cheaper than the earnings you would otherwise get. This is just a very bad gut based decision.