How to Pay Your Mortgage Off Early
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Want to pay off your mortgage early, but don't know how? Learn how you can find the money so you can own your home free and clear!
Pay Your Mortgage Off Early?
Have you ever wondered how would you feel to get rid of your mortgage payment? To own your house free and clear.
Even though we got a really good deal on our place, I would love to see that chunk of money, not leave our accounts every month.
Right now we're on a plan to knock out our mortgage early and we're excited about the process. Of course, this isn't an overnight thing.
Something that's been motivating and encouraging is listening to others. How they found money to pay off their mortgage and how it felt to send in the last payment.
I think that's going to be the frustrating piece for everybody. Who's thinking they're gonna pay off their mortgage early. That there's going to be some big partiesSteve Stewart
Oh, Okay. I guess I'll just send the payment online and celebrate at home. Noted.
By the way that Steve Stewart, he's the talented editor behind some of the fantastic podcasts you've probably listened to like Stacking Benjamins, ChooseFI, and Financial Grownup.
A few years ago, Steve and his wife went to their lender and paid off their mortgage.
Today, we're pulling from the archive my chat with Steve about hitting that huge milestone.
In this episode, we're going to get into why they chose to focus on paying off their mortgage.
Building momentum and payments. And how you can create a mortgage tree plan the fits your goals. In budget. Are you ready? Let's get started.
Resources to Dump Your Mortgage Faster
If you’re looking to dig in deeper on mortgages, here are some resources to check out:
- Best Budget and Money Apps: Personal Capital, Tiller, Mint
- YNAB <- Steve mentioned this as his go to money app
- Mortgage Payoff Calculator
- Total Money Makeover
- Jumpstart Your Marriage and Your Money
- Mortgage Payoff Calculator
- Paying Off Your Mortgage Early
- Paying Off The Mortgage Wasn’t Our First Priority (but we did it anyway)
- 5 Steps To Paying Off Our Mortgage Early
If you want to chat some more about creating better money habits, questions, or share your own tips please join us over at Thriving Families on Facebook.
Want some more motivation to pay your mortgage off faster? Check out my interview with Andy Hill from Marriage, Kids, and Money.
He shares their ambitious plan to get rid of their mortgage in 5 years!
Thank You to Our Sponsor Coastal!
Support for this podcast comes from Coastal Credit Union. If you’re living in the Raleigh Durham area and looking to bank better, come check out Coastal today!
We've been members for years and love their service and competitive rates on checking and savings accounts!
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Why Pay Off Your Mortgage Early?
According to the Bureau of Labor Statistics, the average mortgage payment is around a thousand dollars which might be pricey or a deal depending on what part of the country you live in.
If you're a homeowner you know the mortgage is only part of the total costs. There's property tax maintenance insurance in any home projects that you might have.
Still, that mortgage payment eats up a good amount of our budget. So if you can be done with it – no more payments -you're freeing up some serious cash money that can go into other goals that the two of you may have.
The other side of the argument is, why bother? Why pay it off sooner?
Right now interest rates are low on mortgages. That extra cash can be used for other goals now. So if you can keep that mortgage and save up for that vacation college fund in retirement why not do it?
We can debate the merits of paying off the mortgage versus investing, but really I see this as a win/win scenario. Either way, you're coming out ahead.
The factors you need to consider are your goals and priorities.
For Steve and his wife, the turning point was how they felt about their financial trajectory.
I thought we were doing really well. A couple years later we got a car. She wanted … a two-year-old SUV.
We had to take out like a $12,000 loan for this thing after trading. After some cash that we dropped on the thing we still owed twelve thousand.
I thought, you know we're better than this and that just put a fire under me to say you know this is stupid.
We make too much money to be this broke.Steve Stewart [4:04]
Finding Money to Pay Off Mortgage
If you're going accelerate your mortgage payoff, you need to have some serious cash to throw at it.
Here are some ways the Stewarts ‘found' that extra money.
- Round up the payments.
- Work a side hustle.
- Use any windfalls.
- Check your budget for any money leaks.
- Review your expenses for value.
Not all of these methods will work for you, but try some of them out and see if you can start building momentum with paying off your mortgage faster.
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Episode was originally published August 2016. Episode and show notes updated January 2022.