We’re Debt Free!
It’s official, we have paid off our second mortgage!!! Since January, we have paid down our second mortgage from $74,000 to zero. With that, we have officially paid off $108,000 in consumer debt. And we did it all in 18 months.
When we purchased our home, we put 5% down and took out two loans. A first mortgage for 80% of the home price and our second mortgage was for the remaining 15%. It probably wasn’t the smartest idea to purchase a home with so little down, but we were young. Truth be told, our home was an impulse buy.
It doesn’t feel real yet. When we first sat down and took an honest look at our debt load, it seemed like we had an impossible task ahead of us. How could we possibly pay off this $108,000 worth of debt?
It took a ton of work. We had to set a budget that balanced down to zero. We had to mercilessly cut expenses. And we had to apply every spare penny toward our debt.
We’re now down to just one mortgage, but the work doesn’t end here. Our house is still under water by about $80,000. Fortunately, between paying off the second mortgage and signing away the rental, we’ve freed up an extra $1150 per month. We’re going to go the debt snowball route and use this money to pay down the first mortgage.
I’m going to let this sink in for a few days. I’ll try to acclimate to the feeling of only owing on a single mortgage. When we first sat down to figure out our budget, we were in the red, spending more than we were earning. Now we are saving nearly 50% of our household’s net earnings.
I thought that paying off all of our debt would make me ecstatic with glee, but truth be told this feels more like relief. It’s as though I’ve been holding my breath for the past year and a half and now I finally have the chance to breathe. Exhale. Wow, that feels good.