At Equilibrium
We’re Debt Free! We don’t have credit card, car, mortgage or any other type of debt!
Two weeks ago, on the Wells Fargo Website, we chose the send “Payoff form” option for our last mortgage payment.
My wife filled it out, and we sat on it, waiting for Wells Fargo to pay our real estate taxes from our escrow. Now that they did that, we still have to pay our house insurance at the beginning of March, but… We sent in our last official mortgage payment!
Actually the check is sitting on our kitchen counter downstairs, waiting for me to put it in the mailbox! Tomorrow, I will drop it off at the post office, and then we are finished with it!!! (Booyah)
We ended up paying off our house in a little over 10 years.
So how did we do it?
Well, first we created an excellent excel spreadsheet (later converted to open office) to do some analysis on our amortization schedule.
Primarily, we used primarily 2 sheets in our House Payments spreadsheet:
- The actual payment that was recorded sheet. This sheet was the real deal! As soon as I made a payment on the house, it was recorded in this sheet. Not much to this one, pretty cut and dry. At the top, I calculated the reduction in interest paid by pre-paying, the shorting of the life of the years of the mortgage by prepaying, and the total cost of the initial mortgage plus the interest.
- The “What If” analysis sheet, was the same as the first sheet, but I copied the formula that referenced the payment amount all the way to point the mortgage would be paid off. This was my play sheet! I used this sheet soooo many times to calculation my payment schedule! It was truly great.
Next for the first year of the mortgage, we made double payments on the mortgage amount, with the excess going toward paying down the principal. Then later after our son was born (and my wife quit working), we lessened the payment amount to only 1.5 times the original payment amount.
I’m still in disbelief! I’m at a point of balance and having an “equilibrium moment”, so to speak!
As of this point forward, we will be solidly marching on a wealth building path (or at least I hope, life sometimes throws some wild pitches at you…).
As the last phase of this final numbness wears off, I’ll tell you what it feels like being debt-free in a future post!
-MR
Update: An equilibrium moment is when something is in perfect balance! I don’t owe any debt anymore and nothing is owed to me either! With the “debt phase“, I’m in perfect equilibrium. This phase is over! I don’t plan on ever going into debt that I can’t pay in a month’s time again!
Here are some links to former post in the Countdown series
RSS
Twitter
