Todd and I signed the paperwork a couple of weeks ago our refinanced mortgage. Just to recap, we originally bought our house in 2007 – got a 20 year, 5.99% loan. 3 years later, we refinanced for 15 years at 3.85%. We are cutting 2 years off of the mortgage, have a lower payment every month (not by much, but it still counts!) and will save over $25,000 in interest charges.
If we pay an additional $150/month, the mortgage will be a 10 year mortgage.
How awesome is that? I would be 40 – Todd would be 50 if we were to pay the additional $150/month.
We are on a debt payment budget right now, and strongly believe in Dave Ramsey’s teachings. That being said, I am thinking about straying a bit from Dave’s teachings and pay the additional $150/month while paying down our other two debts (Todd’s vehicle loan and his credit card from BEFORE we were married.) I am considering trying to start selling items on etsy.com and making this extra $150 so that it does not effect the other parts of the budget.
Do you or have you sold anything on etsy?
What are your thought on this? Are we doing the right thing?
I am the least artistic person on the face of the planet, so nothing on etsy.
ReplyDeleteThat's neat about the mortgage. About whether or not you're doing the right thing...
If you need a goal to keep paying off debts, then focusing one at a time like Dave Ramsey suggests is a good idea.
If you are dedicated and are trying to maximize the amount you payoff each month, then interest rates are going to matter, and if your car loan has a higher interest rate than your tax-adjusted mortgage rate, then you should pay it off first and then throw your former carpayment at the mortgage once you're done.
If you're paying off that 150 extra only because you want to send it to the mortgage and you'd just spend it otherwise, then doing that is great too.