zestfive: (Default)
zestfive ([personal profile] zestfive) wrote2012-07-11 12:11 pm

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This is a great website to play with your mortgage...want to see how it might affect paying extra?

[identity profile] wowomom.livejournal.com 2012-07-11 05:43 pm (UTC)(link)
Joe and I hate being in debt. We don't use credit cards and have never in our nearly 8 year marriage had a car payment.

I've thought about sending extra money to pay down our mortgage but I'm not sure if it would be worth it. We already have too much family for too little house (5 people and the dog in 1000sq ft) and sometime in the next 5 years we will be leaving the house.

Which leads me to wonder, should we work on paying down the house when we won't be staying in it very long? Right now we're pretty much even on what we owe vs what the house is worth so will the value of the house go up enough in the next few years to even make it worth paying extra to it?

Ugh. Investments (which is pretty much what our house is since we knew going into it that we wouldnt be staying there) really get beyond my knowledge very quickly.

[identity profile] zestfive.livejournal.com 2012-07-11 07:09 pm (UTC)(link)
I've always been very financially conservative and fortunately I've also been very lucky in my life to not suffer from long unemployment, health issues or the whole host of other things that can impact someone not being able to get a head. I've never had a car payment in my life. I would always get old imports with about 100k miles and drive them another 100k, never paid more than $3200 for a car from a source I know, although I'm sure the cash for clunkers program helped dry up are better used cars (such a waste!) I haven't moved around at all so I never had to sell my house or pay moving expenses.

I would have a hard time trying to figure out your situation but I suppose until you're actually ready to move...it's pointless to think about it or worry.

[identity profile] wowomom.livejournal.com 2012-07-11 07:38 pm (UTC)(link)
Here's what I can figure:

Right now we owe about 78,000 and the house is showing (on zillow.com) at 73,000. Close enough to call it even.

In 5 years we'll owe around 67,000.

So if the house value stays where it is now when we sell in 5 years we'll have $6,000 in our pocket.

But here's where variability comes in at... Will the house be worth more or less in 5 years. I would think it would be worth more. Our town has some huge manufacturing (GM auto plant) comeing back that closed right after we bought our house. The population of the city is growing, we're in the best elementary school district, close to the community college. The towns to the north of us are growing rappidly (we bought our house for 87k, similar houses 15 miles to the north were 165k) and I belive that all that growth will start to come further south and get to our town.

Of course there's no guaretee that the house will go up in value.

So, do we pay more towards the principle now so that when we sell we have more money in our pocket then?

OR do we just sit on our basic payments and hope that the value of the house goes up by 10k in the next few years?

[identity profile] zestfive.livejournal.com 2012-07-13 02:22 pm (UTC)(link)
I sure hope the housing market will turn around some. It does sound like a crap shoot when it comes to paying more now. If I were you and I had enough self discipline, I'd probably take the money that I thought I would prepay and put it into another account that would earn even the smallest amount of interest and then you know at least you wouldn't lose the principal. I'd rather go slow and steady than fast with more risk.