Progress to Date

  • Original Loan Amount: $204,000.00
  • Balance at Beginning of 5-year Goal (1/1/08): $188,983.82 @ 6.00%
  • Balance at Refinance in February 2009: $148,000.00 @ 4.625%
  • Outstanding Balance: $0.00 (PAID IN FULL!!!)
  • Latest Payment Date: April 2011
  • Latest Additional Principal Amount: $17,623.22
  • Amount Ahead of Schedule (since refinance): $121,462
  • Time Ahead of Schedule (since refinance): 7 years 10 months
  • Interest Saved Last Month: $23,972.48
  • Total Interest Saved: $28,435.55 ($1,037.74 on original mortgage; $27,397.81 on current mortgage)
  • Months Remaining in 5-year Goal: 20
  • Average Monthly Principal Needed to Meet Goal: N/A (Goal achieved)
  • Progress List Explained

Thursday, July 31, 2008

Monthly Summary: July 2008

***Update September 1, 2008***
The $1,500 principal payment we sent to our lender in early August 2008 was credited against our July balance, and therefore the numbers I originally listed for July turned out to be wrong. Here is a quick snapshot of the corrections:

Additional Principal Amount: $1,500
Total Principal Payment: $2,388.58
Amount Ahead of Schedule: $19,588
Interest Saved in July / To Date: $89.99 / $287.89 (no change)
Average Principal Payment Required to Meet Goal: $3,097.90 (slight increase from June)
Outstanding Balance at End of July: $164,188.51
Update; Original Entry Follows Below ***

July marks the first month since my wife and I began this project in which we did not make an additional principal payment. There are three primary reasons for this:

  1. Since my wife was paid in advance for some work at the beginning of the summer, we already made a large payment to principal during June. I could argue that we've already made our extra payment for July (but I won't).
  2. We paid most of the cost of our vacation during July. This expense reduced the extra cash we had to contribute toward the mortgage this month.
  3. My wife isn't going to be paid for her July contract work until August due to the mysterious nature of her employer's payroll calendar. I expect we will be able to make a slightly-larger-than-normal additional principal payment next month.
When it became clear to me that we wouldn't be receiving my wife's paycheck in time to put it toward an extra payment during July, I reluctantly made our standard (aka minimum) payment a few days ago. This is how we paid our mortgage during the first 19 months we lived in this house, but it felt odd not to be adding something additional this time around. I guess I've already shifted my expectations so that extra payments are the the rule, not the exception.

And so, our July payment was the 27th of 180 scheduled payments on the 15-year loan, and the seventh since we set our goal to rid ourselves of the debt within five years.

The balance at the beginning of July was $166,577.09. As previously mentioned, we did not make an additional principal payment, so our standard payment reduced the overall balance to $165,688.51 at month's end.

Despite skipping the extra principal contribution this month, we are still about $18,088 ahead of schedule on our payments. And because of our prior efforts to date, we still saved $89.99 in interest this month, bringing our total interest savings to $287.89 so far.

The average principal payment we need to make monthly to meet our goal rose to $3,126.20.

If we receive my wife's paycheck before the 15th of August, I'll go ahead and send it to the lender in hope that they will apply it toward July's balance, since that would fall within the grace period. I'm not clear how our lender handles additional principal contributions received during that window, so it will be an interesting experiment (interesting to me, at least).

The sunset on the last evening of July is beautiful here in New Hampshire. Here's to a wonderful August.


Anonymous said...

I have just found your site. What an excellent resource. I look forward to learning more from you so I can pay off my mortgage too.

change is a good thing said...

You are still doing great! And like you said, you still saved money because you are paying less interest since your principal balance is lower. It's tough when you can't make extra payments though, I know I get frustrated when I am only able to make the minimum payment. I look forward to seeing your continued progress and successes. Great work!!

louise said...

you're making good progress even with no extra payment this month. The irregular income is something I will have to get used to soon,it's going to feel a bit odd to start with.

The Executioner said...

Thanks for the words of encouragement. I'm looking forward to resuming the debt reduction again in August.