tag:blogger.com,1999:blog-1694364001063554832.post7737638130229725201..comments2024-03-18T22:33:57.339-04:00Comments on 5 Acres & A Dream: Of Mortgage DebtLeighhttp://www.blogger.com/profile/02435811789823712254noreply@blogger.comBlogger48125tag:blogger.com,1999:blog-1694364001063554832.post-31615652265133996892015-08-11T05:57:49.071-04:002015-08-11T05:57:49.071-04:00You all sound like us when it comes to debt and mo...You all sound like us when it comes to debt and mortgage. So sorry to hear about your last home. I hope that isn't a sticky point in getting a new mortgage. <br /><br />We're still working to get our place paid off, but it is going to slowly to suit us. We just do the best we can and chip away at it. Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-25628110086031464062015-08-10T11:02:33.948-04:002015-08-10T11:02:33.948-04:00We're about to take on a mortgage in order to ...We're about to take on a mortgage in order to buy our farmette, but we hope it's a means to an end. I'm a saver, and I will work hard to pay the principal down quickly. B/c our kids are getting older, I'm getting a part time job that will really help with paying it off early. I feel deeply the same insecurity that you feel, regarding a mortgage. We lost our last home to foreclosure, and it's a difficult spot for me. Our loan will be pretty small, for a house/farm, so we're hopeful it will be a quick payoff, and that making some money from the farm will help too.M.K.https://www.blogger.com/profile/09205619221345704689noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-60448299321183715462015-04-01T06:19:46.905-04:002015-04-01T06:19:46.905-04:00Elaine, welcome! And thank you for taking the time...Elaine, welcome! And thank you for taking the time to comment, even on an old post. I think you and your husband have made a very wise decision, one that you will never regret. It takes self-discipline to not indulge in the instant gratification mindset. If we had been younger when we started, we would have done the same. Our mortgage remains our only debt, one we still wish we didn't have!Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-15718650203751928962015-03-30T22:53:22.503-04:002015-03-30T22:53:22.503-04:00I realize that this blog post is now 4 yrs old, ho...I realize that this blog post is now 4 yrs old, however this is exactly where I find myself. My husband and I have decided to sell our home and buy land outright... and we will have to rent a house for three years to save to build a house, but we will be mortgage free!! To me this is totally worth the sacrifice of renting and moving again, and building from scratch... to be mortgage free is a dream I am willing to work very hard to obtain!<br />Love the blog, so glad I found itElainehttps://www.blogger.com/profile/18248469603777997770noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-50646107030719639932014-07-24T08:04:28.275-04:002014-07-24T08:04:28.275-04:00Jamie, you bring up a very excellent real life exa...Jamie, you bring up a very excellent real life example, one that folks assume won't happen to themselves. Enslavement to mortgage debt is not an admirable position, no matter how big and fancy the house looks. Thankfully, more and more folks are realizing the idiocy of the current economic system. MLK might not have realized it at the time, but his eloquent pride in being maladjusted is just as relevant today as it was when he spoke it.Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-47655733677490759032014-07-22T16:30:13.235-04:002014-07-22T16:30:13.235-04:00This might be a long post...apologies up front.
In...This might be a long post...apologies up front.<br />In 2003 my husband and I bought a home with the 'One income mentality'. My husband is from Spain so he had a much better understanding and practice of saving and of "debt". I was wanting to purchase a larger home with the intention of paying the mortgage with two incomes but he was adamant that we only count on one. As it happened, I became ill and required surgery that inflicted even more injury than the initial complaint; I was now with chronic pancreatitis.<br />If he had not insisted that we purchase and live our lives acclimated to only one income we would have lost our home during the 2008 banking cartel fiasco.<br /><br />Leigh, you don't need to apologize for the thoughts that you have ( a profound understanding I would call it ) of this American "system". Raging against such a corrupt system is what they don't want us to do. Just accept it as "normal".<br />Money/Paper and Coin are a lot like pornography, once stripped of it, the penniless flounder in such raw poverty that it is difficult to watch without feeling disgust and contempt for those that exploit their dire circumstances.<br /><br />I disagree with this valueless "system" and leave you and your readers with this relevant declaration from MLK: https://www.youtube.com/watch?v=zXEIYpnlxbw<br />Keep up the ranting, Leigh....I am not afraid of, nor offended by, the truth at all. :)jamiehttps://www.blogger.com/profile/04382698709556601510noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-23836156115199882502012-01-31T05:01:36.754-05:002012-01-31T05:01:36.754-05:00You sound like us. :) Except we didn't have an...You sound like us. :) Except we didn't have an additional $30K coming within the next several years, so I can see why you're considering waiting. <br /><br />Our kids are grown and out of the home, so we felt some time pressure if you will, about getting started on our land. I don't know how many time my DH would say "we aren't getting any younger." We actually looked for 3 years though, before we found what we were looking for. One tidbit, because we put 30% down, we did not get the lowest interest rate, even though our credit score was sterling. <br /><br />Other ways to look at it, you could buy now and pay any extra down on the principal as you have it. You can chop years off the life of your mortgage that way. Money lost as rent is never regained. In the meantime, you can be getting established on your place, goals, house, gardens, etc.<br /><br />Sounds like you're taking time and care to think it all through. That's the main thing. :)Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-42894448512325352332012-01-30T21:23:09.151-05:002012-01-30T21:23:09.151-05:00Reading this post is well timed for us. We are ju...Reading this post is well timed for us. We are just starting to consider the purchase of our first house. We currently rent. We have about 20k to put down and are looking for something under 80k. Luckily we live is a rural part of the midwest where housing is cheap. We could also wait another couple years and have more like 50k. However, we'd also be losing 10k or so to rent. Would it be better to put that money into house equity? I guess we still have some thinking to do.Fhttps://www.blogger.com/profile/15806422800093554729noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-63922698493800650842011-12-09T20:56:50.393-05:002011-12-09T20:56:50.393-05:00Alison, I didn't realize I hadn't responde...Alison, I didn't realize I hadn't responded to your comment. We have the same situation here in the US. Very few folks can buy without a mortgage, and I think you're right about house prices. The other thing that has done this, is perceiving houses as investments rather than homes. Folks are all too willing to sell to turn a quick profit, which drives prices up to where many of us cannot them. <br /><br />J Smith, I never could understand the mindset that debt is good and desirable. Good point that folks are totally removed from the true cost and value of things they don't pay for directly. You are one of the few folks I know who was able to pay cash for your land! That is so admirable. Our only debt is our mortgage, but we bought cheap (house badly needing repair, hence all the remodel posts :), and were able to put 30% down. We pay extra on the principal with a goal of getting this place paid off ASAP. Yes it's possible to pay it off early. The savings on the interest alone ought to be a motivator!Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-22508623724167457272011-12-09T10:00:30.935-05:002011-12-09T10:00:30.935-05:00Just thought I would put my two cents in here. I f...Just thought I would put my two cents in here. I feel that debt has done alot of harm to the country and the way Americans think of debt. Not to long ago debt was to be avoided and you were unable to take out an interest only loan with no money down on a house(still cant believe people fell for those - one being my aunt). This easy money(financing) sent prices thru the roof as it removed people from the actual cost of the property, the mindset was I can afford the monthly payment, never mind I am paying $500,000 for a house that cost $75,000 to build. I could go on all day about how this mentality drives up costs on property, health care, etc... <br /><br />I myself started working when I was 14 at McDonalds saving. I bought my first car when I was 15 paying cash. Work thru college paying in cash. I have since bought several new cars since then paying in cash, most recent being a 2011 and a 2009. I do not have a mortgage because I rent which is changing soon as I just bought 10 acres and paid cash. The cabin I build will be paid in cash as well. Anyone can do it, it is hard and you go without many things but once you reach the goal of no debt all of a sudden your bank account continues to grow and when you want that new car, that new tv, etc.. the money is there.<br /><br />I will say ANY one in any situation can accomplish debt free life. I know some people are probably saying well hes a single guy with no responsiblites which is not accurate. My g/f stays home full time with our 2 boys 5 and 1. My full time job I make just above the poverty level for a family of 4(thank you college!Which the sate of our education system is a whole different topic!). I do however work 2 other jobs which allows us to have the money to pay cash for things. I myself am sick of working 3 jobs which lead me to homesteading, Im sick of working for other people. <br /><br />Im sorry that I rambled on about this so much, this is just one topic that really hits home for me. My mother lives pay check to paycheck as do my g/f parents who recently lost their house to forclosure. <br /><br />Everyone out there that does have a mortgage and feels helpless to pay it off. I just want to say you can pay it off quicker than you think. Those little extra payments add up and save 10's of thousands in interest paid to the bank.<br /><br />~end of rantJ Smithhttps://www.blogger.com/profile/17253953329574111750noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-7653115030738897912011-04-14T12:09:03.266-04:002011-04-14T12:09:03.266-04:00I'm late catching up on blog posts, but wanted...I'm late catching up on blog posts, but wanted to chime in here. J and I have a mortgage on our home. It is the only debt we have, and we selected a level of debt that *either* of us could manage on our employment income, rather than one we could only manage together.<br /><br />In the UK, a mortgage is the only realistic way for most people to buy a home - at least, their first one. If you rent, you never get *any* of your money back - and you still don't own your place. The only other option would be to rent somewhere very small and save and save and save.... Most people would probably never get there.<br /><br />Of course, you can argue that it is the prevalence of easy borrowing (and the number of dual-income families) that has pushed housing prices through the roof. It is a myth that families are better off with both parents working; it may have been true *before* it became the norm, but now stratospheric house prices have simply slurped up all the available 'extra money' so you need two incomes to afford a family sized home. But that's a rant for another day.Alisonhttp://www.yarnscape.co.uknoreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-2155018006349354682011-04-14T06:07:37.091-04:002011-04-14T06:07:37.091-04:00Val, I think a lot of us don't understand the ...Val, I think a lot of us don't understand the US housing market. Personally, I think the whole system has been corrupted by the "big bucks" mentality. You'd think the powers that be would have learned a lesson, and reformed the entire system after the US mortgage crisis. I think it should have been a requirement to receive mortgage bailout money, but it wasn't. Tax payers made up for the lenders' loses, and idiotically, the same practices continue, with more hoops for potential borrowers to jump through. Gee, that sounds like a bit of a rant, doesn't it? Which is to say, it sounds like Canada made much wiser use of the lesson learned.Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-40218156857186034082011-04-14T02:06:38.622-04:002011-04-14T02:06:38.622-04:00Hi Leigh,
I am a bit late to comment here but as...Hi Leigh, <br /><br />I am a bit late to comment here but as I live in Canada things are a bit different. <br /><br />We paid off our home in 13 years, there is no tax deduction for mortgage interest and we had a very open mortgage. We could pay up to double each month if we wanted and there was no early payment penalties. As the interest rates dropped and our mortgage came up for renewal we kept the payment the same or adjusted it higher as we got pay raises. <br /><br />We cut 12 years off the mortgage without penalties.<br /><br />We do however use credit wisely. For large reno projects we use the 12 months interest free plan that the local building store credit card has. We have always paid it off within the required time so haven't had to pay interest.<br /><br />I don't understand the housing market in the US, but here we are not allowed to finance a home 100% anymore, you must have a down payment and you can't overpay for a house, nor can you buy a home that you can't reasonably afford. <br /><br />The main difference tho is that there is no tax benefits whatsoever with a mortgage or interest.<br /><br />ValAnonymousnoreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-38154093699396002382011-04-13T18:30:16.700-04:002011-04-13T18:30:16.700-04:00We would love to have our house paid off. It reall...We would love to have our house paid off. It really bothers Lee to have that debt. But it is our only debt so that is nice at least. We were just discussing a few days ago about adding more money to our house payment every month to help get it down faster. Sometimes it's frustrating because we have so much work that needs done on our place which requires money on top of the house payment.Robinhttp://farmfolly.comnoreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-4918568807977076872011-04-13T13:50:24.416-04:002011-04-13T13:50:24.416-04:00P.S. I think we did save on some other charges and...P.S. I think we did save on some other charges and costs though, by putting that much down. I can't recall exactly what at the moment, but for someone considering variables on a mortgage, it would be another factor to consider.Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-51081192850917767592011-04-13T13:44:47.241-04:002011-04-13T13:44:47.241-04:00Michelle, good point and hopefully that will help...Michelle, good point and hopefully that will help someone reading this and needing to make a decision. If we had known upfront about the interest rates, we would have made a different choice, but unfortunately, we didn't know about it until <i>after</i> we had already done the paperwork. Still, our monthly payments are way less than what we could rent for, so we'll count the blessings. <br /><br />We did make sure there was no penalty for early payout. That's in our contract but our mortgage has already been sold once, so who knows what will happen down the road?????Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-78429148494479071172011-04-13T13:04:19.463-04:002011-04-13T13:04:19.463-04:00Leigh, you should have put down whatever would hav...Leigh, you should have put down whatever would have given you the best rate, making sure there was no early pay-off penalty, then put the extra cash you had on principal. I know, too late now, but maybe it will help someone else.Michellehttps://www.blogger.com/profile/01550786937196525098noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-7927737409872202242011-04-13T12:50:35.740-04:002011-04-13T12:50:35.740-04:00Toni, that seems to be most of us. Being able to r...Toni, that seems to be most of us. Being able to refinance at lower interest rates and having a plan to get to payoff within 10 years is excellent. We were fortunate to buy when the rates had plummeted quite a bit. The only "bad" thing was that since we put 30% down, we didn't qualify for the lowest rates!<br /><br />Laura, very depressing indeed. I think a lot of folks have run into that, but unless you're planning to sell within the next so many years, who knows, values might go back up.<br /><br />I have to say, I can't tell you how much I admire you for making the go alone! Not sure if I'd be able to do it. <br /><br />Emma, no worries, you didn't start an internet tirade, LOL. I've actually been working on this post for while. You mention a key factor actually, "comfort level." It's been interesting reading all the comments, because it seems that different things represent security to different ones of us. Working out a plan with that in mind is the best way to make actual progress on being 100% debt free, I think.Leighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-72760772031900279872011-04-13T11:20:11.919-04:002011-04-13T11:20:11.919-04:00I definitely understand what you're going thro...I definitely understand what you're going through. Both you and Tami made mortgage-esque posts after my rant, so I'm wondering if I stirred something up? I hope it didn't cause problems! =P <br /><br />We're concerned about the long term viability of cash as it's purchasing power continues to decrease. I read somewhere yesterday that purchasing power has decreased 37% since 1995. In 15 years!?! Kinda scary, especially since we don't know what the government will do with all the debt mess. <br /><br />Since we have to carry PMI insurance for the first two years once we purchase the house, we're planning on stashing the 20% needed to pay it down to drop PMI over the next year but not actually pay it down. Keep the savings in hand until making the payment will actually matter. And it'll provide me with more confidence. Dropping that $50 / month will only increase our payoff quicker. <br /><br />Our plan is to have 6 months of expenses covered in savings, save up that 20%, and then drop everything else into preps and gardening and food storage. Realistically, we'd like to get the house paid off in the next 5 years but depending on when we decide we want to build out in Wildwood, we'll probably save the money instead so we'll have the cash to build instead of getting (another) mortgage. <br /><br />Not having any debt is a long term goal, but it's not the highest priority for us right now. <br /><br />Good luck working out a plan!<br /><br />Emma<br /><a href="http://cityrootscountrylife.com" rel="nofollow">City Roots, Country Life</a>Joseph and Emmahttps://www.blogger.com/profile/17696559423977596641noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-37432111435092941642011-04-11T10:25:03.747-04:002011-04-11T10:25:03.747-04:00when I bought my current place, I put $75k down (f...when I bought my current place, I put $75k down (from the sale of a previous pile of...). Effectively, I had 45% equity in my farm. I now have negative equity, as my real estate agent tells me that I'd be lucky to sell it for what I owed, not including all the costs of sale. It's very depressing. VERY depressing!<br /><br />Unfortunately, college for me included lots of loans, so I have that debt hanging over my head, as well. (I graduated when I was 40) <br /><br />At 57, I don't really see an end to it until (may be be a blessedly long time) my dad passes. I try to be responsible, but being a single person operation is very difficult.Laurahttps://www.blogger.com/profile/08421589409738817614noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-49349680194542665482011-04-10T09:25:22.635-04:002011-04-10T09:25:22.635-04:00We are not mortgage free either. However, we are o...We are not mortgage free either. However, we are on target to have it paid off in nine years, which compared to 30 year loan we acquired when we moved here in 2006, is a huge difference. We refinanced to a 15yr when the interest rates dropped last year and then did the math on how much extra principle we needed to add on a monthly basis to have the loan paid off in 10 years. Luckily we are still on target and the plan is any extra cash will also go towards getting rid of it.<br /><br />It was interesting reading everyone's responses to this post.Toni aka irishlashttps://www.blogger.com/profile/05439209726767685697noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-45476616291662750242011-04-10T08:08:54.684-04:002011-04-10T08:08:54.684-04:00Eliza Faith, thanks!
Tami, how funny. Both our id...Eliza Faith, thanks!<br /><br />Tami, how funny. Both our identical topic and especially the word verification! Do you think somebody actually gets paid to come up with stuff like that?!? LOL<br /><br />I'm on my way over to your blog to read your post!<br /><br />Kelle, what a great story. Not settling for too big a price tag and having a decent down payment is such a help. I know not everyone would agree with using an IRA to pay off a mortgage, but I say brilliant! A secure home is a major retirement necessity!<br /><br />Your added comment about debt and credit rating is part of why the system is flawed and doomed to fail. It actually punishes people for being responsible with their money. It took us several years to build up "credit" in order to get loan approval for this place. Crazy!<br /><br />Anon, good for you for following common sense rather than what everybody else said. I absolutely agree with you about "investments" and "wealth management." It would be one thing if the rules were in place to protect the investor, but in reality, they allow everybody else to a cut via fees and penalties. And in increasing devious and complicated ways! If I had a choice, I'd take the little farm over the wealth. If there's no food to buy, who cares how much gold one has invested in. <br /><br />Katrien, from one "deadbeat" to another, I say that's an excellent way to go. And for you, it's wonderful that it can be principal only. It's too bad more parents don't help their children like this. <br /><br />Det Goda Livet / Tove, it's the same way here. In fact, since we had no previous home or apartment to sell, we almost had no down payment for buying a home. There are 100% financed mortgages, but that means so much longer to pay it off. In the end, I received an unexpected but small inheritance that enabled us to have a down payment. <br /><br />BTW, your English is very good indeedLeighhttps://www.blogger.com/profile/02435811789823712254noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-37863415183869520502011-04-10T01:52:24.377-04:002011-04-10T01:52:24.377-04:00This is an interesting subject. I know some people...This is an interesting subject. I know some people who have followed their dream and moved out to the countryside early in life. They all still have mortage debt on their properties. I also know people who own the same size properties at similar locations witouth having any mortage debt att all. They all have pretty much the same income level so what is the difference? At least here in Sweden (I'm swedish which explains my poor english) ,the key to owning your own house without a large debt is "climbing the property ladder". The people who stayed in the city for a longer time, and bought apartments in the central parts of town or small houses in the suburb, have been able to buy properties in the counryside (which are cheaper) for the money they earned by selling their house/appartment in town. The people who moved tho the countryside directly from rented appartments didnt have the same possibility. It's kind of a twistwd system but thats how it works here.Mor Grönhttps://www.blogger.com/profile/10529546675471239945noreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-70961898515582032832011-04-09T18:59:13.780-04:002011-04-09T18:59:13.780-04:00We've paid off our mortgage, in a sense. My fa...We've paid off our mortgage, in a sense. My father-in-law paid it off and now we're paying him back the same amount we used to pay the bank, but it's all principal.<br />We have no other debt, never have had. Our graduate studies were on scholarships. Our undergrads were done in countries where they were as good as free. And credit card... ha! We're the ones the credit card cos call "dead beats". Too bad, suckers! Now how d'you write that smiley that sticks its tongue out?katrienhttp://blog.bolandbol.comnoreply@blogger.comtag:blogger.com,1999:blog-1694364001063554832.post-52261801156255714242011-04-09T18:57:28.551-04:002011-04-09T18:57:28.551-04:00In April 2007 we sold our Houston McMansion and bo...In April 2007 we sold our Houston McMansion and bought a house 1/2 the price with cash. People told us we were crazy for not investing the money and getting a mortgage. We all know what happened to the market after the housing collapse. <br /><br />In April 2010 we took my IRA, cashed it out and bought a small farm outside the city (in addition to our city house). We went from wanting to be debt free to questioning the wisdom of IRA / 401K savings. People again told us we were crazy for cashing out retirement savings and paying all the taxes and penalties. We'll see down the road, but I no longer feel comfortable having money in accounts with so many gov't rules. No where is 'safe', but you do the best you can to protect wealth you've worked so hard to save. <br /><br />p.s. we are debt free on all else as wellAnonymousnoreply@blogger.com