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Thanks to your guidance the Mortgage is going today.
Old 01-06-2011, 08:14 AM   #1
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Thanks to your guidance the Mortgage is going today.

I would like to thank everyone for the massive discussions on paying off the mortgage. After much thought I cut a check for the remaining 174k and change this morning.

There were many points but the one that swayed me the most was sitting on that extra stash was skewing my ER numbers both in cash flow and in felling richer than I really was. Not to mention this full amount was in stocks and had a great run over the last few months. I couldn't see the point in keeping taking the market risk.

Math aside, now my expenditures are down I am sure I will build it back up in no time.

Me I am 38 now fully debt free. Emergency fund still stands at 12 months last months expenses. Good job, great income, and a feeling that things are solidly on track for very early retirement.

Thank you all for the positive and negatives to the mortgage question. I took them all very seriously in my decision. As you have thrashed the subject out so well it was a difficult decision to come too. For me I Believe I made the best risk vs reward for my situation.
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Old 01-06-2011, 08:16 AM   #2
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Congrats to you!
It is a wonderful feeling to have and I am glad that you carefully weighed the differing views before pulling the trigger.
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Old 01-06-2011, 09:06 AM   #3
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Quote:
Originally Posted by RetirementColdHardTruth View Post
I would like to thank everyone for the massive discussions on paying off the mortgage. After much thought I cut a check for the remaining 174k and change this morning.

There were many points but the one that swayed me the most was sitting on that extra stash was skewing my ER numbers both in cash flow and in felling richer than I really was. Not to mention this full amount was in stocks and had a great run over the last few months. I couldn't see the point in keeping taking the market risk.

Math aside, now my expenditures are down I am sure I will build it back up in no time.

Me I am 38 now fully debt free. Emergency fund still stands at 12 months last months expenses. Good job, great income, and a feeling that things are solidly on track for very early retirement.

Thank you all for the positive and negatives to the mortgage question. I took them all very seriously in my decision. As you have thrashed the subject out so well it was a difficult decision to come too. For me I Believe I made the best risk vs reward for my situation.
How about the fact that no bank OWNS you? And noone can take your house away if you fall on hard times? There are definite bonuses to what you just did!
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Old 01-06-2011, 10:03 AM   #4
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Congratulations! It's a wonderful feeling to know that your planned retirement income no longer has to cover your mortgage.
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Old 01-06-2011, 10:54 AM   #5
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Congrats... it is a good feeling! Wait 'til u go inside a bank for a transaction and they tout low refi options since you own. They always looked at me funny (probably cuz I look funny too) when I say, don't have one.
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Old 01-06-2011, 11:10 AM   #6
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Congratulations! What a feeling knowing that obligation is behind you, (and that the money you used to save with your mortgage tax deduction can now go to federal loan modifications for your neighbors underwater mortgages!)

Seriously, great job, quite an accomplishment at 38! Keep us posted on how the asset accumulation is going, we like success stories here on E-R.org.

And, one more vote for the "paying off the mortgage early" camp! (we appreciate your support; were afraid we might have lost you to the dark side until you posted this update.)
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Old 01-06-2011, 12:40 PM   #7
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Congratulations! You will really enjoy having extra "income" now that the mortgage monkey is off your back!
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Old 01-06-2011, 12:54 PM   #8
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Originally Posted by RetirementColdHardTruth View Post
I would like to thank everyone for the massive discussions on paying off the mortgage. After much thought I cut a check for the remaining 174k and change this morning.

There were many points but the one that swayed me the most was sitting on that extra stash was skewing my ER numbers both in cash flow and in felling richer than I really was. Not to mention this full amount was in stocks and had a great run over the last few months. I couldn't see the point in keeping taking the market risk.

Math aside, now my expenditures are down I am sure I will build it back up in no time.

Me I am 38 now fully debt free. Emergency fund still stands at 12 months last months expenses. Good job, great income, and a feeling that things are solidly on track for very early retirement.

Thank you all for the positive and negatives to the mortgage question. I took them all very seriously in my decision. As you have thrashed the subject out so well it was a difficult decision to come too. For me I Believe I made the best risk vs reward for my situation.
Congrats! It's such a great feeling knowing that you own your house 'free and clear'.

Going forward, as the subject of mortgages/house payment/ etc. comes up in the course of workplace conversations, watch closely the reactions of boss(es) and co-workers as they find out you don't have a mortgage.

I found that my boss(es) quickly realized they no longer 'owned' me and I sensed that co-workers were a bit jealous. I willingly offered to share my secrets (LBYM, FIRE planning, etc) but no one was overly interested for very long. LOL

omni
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Old 01-06-2011, 12:57 PM   #9
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Well done, like everything I have a foot in both camps. I like the freedom and cash flow advantages of being mortgage free, but I also like to have a good after tax buffer against bad times and to get some returns from this rising market. It all comes down to risk/cashflow/rewards balancing.

So as I want to be mortgage free, I've been cashing in stocks on the way up to keep my AA at 50/50 and putting most of the gains towards the mortgage. I went from a balance of $190k last Jan to $130k today. I could pay it off today, but it would make me a bit cash poor and I hope that taking gains and paying down principal will get me to $70k next Jan at which point I'll pay it off and ER at 50 as I don't want to carry any debt into retirement.
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Old 01-06-2011, 01:03 PM   #10
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Congratulations. I am also 38, and paid off my mortgage in November. Feels great. One of my top thrills in 2010: Sitting next to my older brother while he was discussing refinancing his house. He has an MBA and higher family income than me. I suspect he views himself as more financially sophisticated, too-and he is probably right!
"You should look into this, Little Bro. Rates are the lowest we'll see in our lifetimes."
I smiled and said "Already did. Numbers didn't work for us."
Short pause for dramatics.
"Decided to pay it off next month instead." The look of surprise was priceless.
Sometimes it pays to be unsophisticated.
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Old 01-06-2011, 01:22 PM   #11
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I believe that paying my mortgage off 3 years before ER was the key to ER.

ERed 5 years mortgage free 8 years.
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Old 01-06-2011, 03:55 PM   #12
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I've chosen to hang onto my mortgage until I can get Medicare and my health insurance costs drop - right now I can itemize on taxes and the mortgage interest is deductible.

OTOH - my mortgage payment is only $328/month... I think I owe less than $40K. So it's no big deal, I could pay it off at any time.

Congratulations on being mortgage free at your age!
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Old 01-06-2011, 05:01 PM   #13
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right now I can itemize on taxes and the mortgage interest is deductible.
Canadians have always been a bit envious of that deduction, and most are trying hard to eliminate that debt. The interesting parts is that if a Canadian has paid off his mortgage, he can then take out a new one and deduct the interest provided the mortgaged funds are invested. Very few do.
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Old 01-06-2011, 05:06 PM   #14
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Congrats as well. Now make yourself a reminder for about ninety days from closing to confirm you have received notice of release from the Trustee and the release shows it has been recorded in your county. Normal process as I understand it is the holder of your Deed of Trust has to send the release of the original Deed of Trust to your county clerk/recorder so that the lien (mortgage) is removed from your home.
If it does not show-up, it is time to make noise with the bank that serviced your loan.
Others will hopefully weigh in if I should I used a different terminology but I am pretty sure it is Deed of Trust that needs a release
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Old 01-06-2011, 07:11 PM   #15
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Congrats! No looking back.
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Old 01-06-2011, 07:40 PM   #16
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Congrats! It's a good feeling knowing that as long as your property taxes are paid, no one can kick you out of the place that you Own 100%.
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Old 01-06-2011, 08:04 PM   #17
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Congrats to you! I paid mine off about 5 years ago and it is a great feeling. The extra free cash flow is amazing.
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Old 01-07-2011, 05:00 AM   #18
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Others will hopefully weigh in if I should I used a different terminology but I am pretty sure it is Deed of Trust that needs a release
Nwsteve
The terminology differs from state to state but you're correct. When we paid off our house (in part because the mortgage had been sold by the local bank to somewhere in Indiana) it took almost six months to get the lien release recorded. I kept after them because I knew we were going to be selling in about another two years.

Scary part: A nice lady at the bank told me she finally found the paperwork in a box stored in a hallway! Evidently they weren't prepared for the flood of paperwork from the additional mortgages the bank bought.
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