Mortgage Balance (UPDATE) - FEB 2017

If you have viewed our family's Net Worth Page, you probably already know that it does not include the equity in our home.  Although, we do realize that it is technically part of our overall net worth, we decided that since our home equity is not an asset that we can count on for income (unless we sell and buy something cheaper) we would exclude it from our net worth calculation.

For the purpose of this blog, we are more interested in documenting our loan balance rather than our home equity.  With that said, we will use the current Zillow value as our estimated home value and use it to figure out the percentage we owe on our home. For those interested, we will include the amount of our home equity, but know that we are less concerned with the equity since we have no plans to cash out or otherwise sell our home. Our main goal is to pay off our home on or before my retirement date. 

HOME VALUE:

According to Zillow, our home is currently worth: $837,006 (up $9,699 in the last 30-days). Real estate typically cools down (literally) in the winter months so the spike we saw this past month was quite unexpected. We believe that that the high likelihood of a rate increases has triggered some urgency in those whom are in the market for a home and hoping to lock in a mortgage at current rates before they go up further. But honestly, we don't really study the real estate market since we don't see our home as an investment. To us, our home is just that, a place where we live and raise our kids. We do care if the area has great schools and that the neighborhood is not on the decline.  But since we have no intention of selling in the near future, we don't really care that our home value has been so volatile. 

It's fun to calculate and certainly makes you feel a little bit more wealthy but, if you follow us, the reality is that whether our home prices rise or fall, it really doesn't mean much to our family as we have no intentions to sell or otherwise move.  We are very lucky to be able to say that we love were we are and couldn't see ourselves living and/or raising our family any other place. :)

Mortgage Balance (As of February 1st):
$289,242 (down $1,903 from our post last month)

Percentage Owed:
34.5% (up .7% from our post last month)

Home Equity:
$547,764 (up $13,509 from our post last month)
   

Mortgage Background:
For those that have not read the Preface on our home equity, we currently hold a 15-year fixed rate mortgage at the incredibly low rate of 2.875%.  My goal is to retire within 10 years and 4 months (124 months) so we are setting out to pay off our mortgage on or before my retirement date. Right now we are a few months behind the target retirement date. Currently, we have approximately 11  years and 2 months (134 months) left on our mortgage.  Nevertheless, I would like to have it paid off in another 10 years (or less). If we accomplish that, I plan to use the last few years to aggressively build our passive income to help supplement our retirement and defer tapping into the 457K as long as we can so it can continue to grow. 

Right now we are not putting any extra money towards the principal given our low 2.875% interest rate. We feel that we could make our money grow faster by investing it and while keeping the money more liquid. At a certain point, maybe in 6-9 years, we may consider using money from our investment accounts to wipe out the remaining mortgage balance.  Until then, we will continue to grow that money outside, rather than have it locked into our home.

  

Click on the link below to view our mortgage balance history:

Mortgage Balance History