In another life, I was a loan officer at a financial institution. Here is a suggestion for those with goals of increasing equity in their homes at a quicker rate. Paying a few extra dollars a month on your home payment will reduce your principal balance and shave off years from your mortgage. You will save thousands of dollars in interest over the life of your loan. When your 30 year loan term is set, ask your lender how much you would need to pay to cut five or ten years off your term. Set your loan term for the longest and safest term, but make the payment for s lesser term. Even $20 a month extra goes to your principal balance and saves you major money over the years.
We paid off a 25-year mortgage in 11 years by paying bi-weekly vs monthly, and keeping our payments the same when we renewed after 5 years, even though rates were lower. And whenever we came into a chunk of money (income tax refunds, bonuses at work, etc.), we'd set aside $100 each to blow on whatever we wanted (usually books, lol) and apply the rest to the principal. This was all allowed under the terms of our mortgage, and it really does help! (This was in Canada, where the system might be a little different.)
Love this post! Three years ago when I bought my house at age 66, a friend expressed concern - what if I fell while alone, house repairs are unexpected and never-ending, stairs are dangerous, etc. I’m handling it all! Got a sweet rescue dog, just made a vegetable garden and have a trusted handyman. And it’s all mine to be passed to my kids eventually!
By the number of responses this seems of interest to many and everyone has a story of how they got their homes. My story is that my parents died and left me and my siblings all money and for me it was a deposit on the house that I have lived in for over 30 years. I feel so grateful that I have my home which will be my son's inheritance when I die.
I've been very lucky and very grateful. I'm 74 and I own my own home (townhouse) outright.
My life has been full of unexpected twists and turns and upheavals Over the decades I have bought and sold properties on my own and also with spouses. My late husband and I owned our property with the help of his inheritance. It was too big for one person so I was able to sell it and downsize to a townhouse. My wonky "fixer upper" . It has a cosy feel though and I'm learning a lot ! And it's mine. I get to choose whether I stay or go.
These days in Australia it's very hard to get a place of your own due to an overly generous tax concession (started in 1990s) for housing investors which has driven up the prices to unsustainable levels! Easy to afford an investment property but not your own place ! Crazy!So you see younger folk living at home for longer to save up or buying an investment property while they rent. 🤦🏼♀️.
In this climate it's hard to imagine how older women (who find themselves unexpectedly single) would cope if they didn't have an income. Hence the growing homelessness.
Final word .... I've always found brokers to be very useful.
When I was on my own, I was happy to rent. I had no interest in doing maintenance myself. The main problem about living in an apartment is the noise--living under a heavy walker whose feet THUMP across their floor/my ceiling, or neighbors who blast their music.
When I married, we got a house. We bought during the real-estate bubble of the early 2000s, when mortgages were at crazy-low rates (3%!), and when the brokers' calculators were telling us we could afford houses costing twice as much as we thought we could afford. Two things really saved us: my insistence on a fixed-rate mortgage (not the adjustable-rate ones that devastated so many homeowners during the 2008 crash); and our insistence on buying a house that we could support on one income, though we had two incomes at the time. When my husband got laid off a couple of years later and the economy went south, we were able to stay in our home.
We paid off the place in less than 15 years, but the thing is: property taxes are very high here. Like $10,000 a year. Add in maintenance (new roof, tree work, replacing appliances, updating a 1970s kitchen, etc.), and I would bet that renting is actually cheaper.
I do like the quiet here, the spaciousness, and the ability to have our own yard. But some neighbor is always calling the township to complain that our lawn doesn't look like a golf course, and the upkeep of a house and yard will be beyond us eventually. My plan is for us to look at moving into senior housing or some kind of rental situation in about 8-10 years, around the time my husband is 80.
I bought as a single person. I am managing. I don’t know that I want to deal with the property/upkeep into my later years but it is nice knowing my $$ is building equity. I do hope we don’t end up in recession. The last one, my last home ended up under water and I couldn’t sell for over a decade without losing money or costing me money. Thus my best advice is put down as much to lower your mortgage balance to start as possible. That last home, we didn’t do that, opting to pay the lowest down payment allowed so as to have $$ to spend—thus when I ended up with the house in my divorce, my mortgage was really high with 1 income. I managed but it was tight. Will never do that again!! This house, on my own, I put down a lot!!
The one sentence stands out for me…. I’ve done it and said to my friends, singles, try not to retire with a mortgage. My husband died nine years ago, I retired in 2022. Fortunately I had a good job and cleared my mortgage before I retired. No mortgage insurance for me as my husband’s health made it incredibly expensive.
My stepkids bought out my share of the house, after my husband died. It wasn't a lot, but I kept looking for cheap housing. An internet friend suggested KS and I bought my house, sight unseen, for $28,000 three years ago. All it had to do is outlast me. It's small and simple, built in 1951. I will never be the old lady in the tent under the overpass.
I think the two issues at the core are freedom and safety. Freedom to do what you want and the financial security to not feel like you are steps away from disaster. For some that is homeownership, for others it isn't.
As we age there is always the possibility that we won't be able to age in place so any plan has to be flexible. Things happen and there always has to be a backup plan.
Hubby and I built our first home, where we currently live, back in 2002. We were both working fulltime back then. We were very lucky to be renting from a friend's parents and paid extremely cheap rent. We paid off credit cards, and saved up, putting 20% down, got a fantastic rate on 30 year fixed, from a local bank, well regarded. Both of us had only ever rented, mostly apartments. We liked the duplex we were living in before we bought but the neighborhood was going downhill fast. (Example, house across the street was raided for prostitution the week after we moved out!) We were able to refinance back in 2017, knocked 5 years off mortgage and lowered rate by almost half. Last summer we paid off the mortgage. It is such a stress reliever to own our home free in clear. Yes, there is upkeep involved but we're doing fine for now. Neither of us has ever made a lot of money on our jobs (me especially). I doubt I could afford anything on my own now rent-wise. Only regret, being in a HOA. They can be a real pain in the keister sometimes. We get nothing except a fancy brick wall at the entrance to our development for the money we pay.
Our home is 1700 sq. ft. and will be paid off in six more payments. Our first home was 1974 and we paid $33,950, it was almost as big as this home. In between, we owned two other houses that were larger, this one was a downsize but the cost was upsized! Our PITI is $1525, we could not rent for that, no way! I am so glad we have this house, had we not started young and worked our way up we could not have afforded to live here. Looking forward to being mortgage free and grateful that we could get into home ownership at a young age. I hope to stay here forever, and I take very good care of my health so that I can be independent for many more years. We live in an HOA community and our yard work is included in the quarterly fee of $615. Well worth it. I plan to leave this house to my daughter-in-law and grandson to pay for his college education. That is my big WHY for taking care of myself!
Yes, and a bit of luck! I feel sorry for young people just starting out. A house like ours, bought used and with 20% downpayment, would cost the buyer about $7200 a month PITI and HOA. Yikes!
In another life, I was a loan officer at a financial institution. Here is a suggestion for those with goals of increasing equity in their homes at a quicker rate. Paying a few extra dollars a month on your home payment will reduce your principal balance and shave off years from your mortgage. You will save thousands of dollars in interest over the life of your loan. When your 30 year loan term is set, ask your lender how much you would need to pay to cut five or ten years off your term. Set your loan term for the longest and safest term, but make the payment for s lesser term. Even $20 a month extra goes to your principal balance and saves you major money over the years.
We paid off a 25-year mortgage in 11 years by paying bi-weekly vs monthly, and keeping our payments the same when we renewed after 5 years, even though rates were lower. And whenever we came into a chunk of money (income tax refunds, bonuses at work, etc.), we'd set aside $100 each to blow on whatever we wanted (usually books, lol) and apply the rest to the principal. This was all allowed under the terms of our mortgage, and it really does help! (This was in Canada, where the system might be a little different.)
Good advice, Denise. Thank you.
Love this post! Three years ago when I bought my house at age 66, a friend expressed concern - what if I fell while alone, house repairs are unexpected and never-ending, stairs are dangerous, etc. I’m handling it all! Got a sweet rescue dog, just made a vegetable garden and have a trusted handyman. And it’s all mine to be passed to my kids eventually!
By the number of responses this seems of interest to many and everyone has a story of how they got their homes. My story is that my parents died and left me and my siblings all money and for me it was a deposit on the house that I have lived in for over 30 years. I feel so grateful that I have my home which will be my son's inheritance when I die.
Carolyn, this is nosy, but I know you had a pretty good job with the city. Would you have been able to buy a house without your inheritance?
(Readers, Carolyn worked with my husband in the San Jose Recreation Department, managing the senior centers)
Great post. Thank you.
I've been very lucky and very grateful. I'm 74 and I own my own home (townhouse) outright.
My life has been full of unexpected twists and turns and upheavals Over the decades I have bought and sold properties on my own and also with spouses. My late husband and I owned our property with the help of his inheritance. It was too big for one person so I was able to sell it and downsize to a townhouse. My wonky "fixer upper" . It has a cosy feel though and I'm learning a lot ! And it's mine. I get to choose whether I stay or go.
These days in Australia it's very hard to get a place of your own due to an overly generous tax concession (started in 1990s) for housing investors which has driven up the prices to unsustainable levels! Easy to afford an investment property but not your own place ! Crazy!So you see younger folk living at home for longer to save up or buying an investment property while they rent. 🤦🏼♀️.
In this climate it's hard to imagine how older women (who find themselves unexpectedly single) would cope if they didn't have an income. Hence the growing homelessness.
Final word .... I've always found brokers to be very useful.
When I was on my own, I was happy to rent. I had no interest in doing maintenance myself. The main problem about living in an apartment is the noise--living under a heavy walker whose feet THUMP across their floor/my ceiling, or neighbors who blast their music.
When I married, we got a house. We bought during the real-estate bubble of the early 2000s, when mortgages were at crazy-low rates (3%!), and when the brokers' calculators were telling us we could afford houses costing twice as much as we thought we could afford. Two things really saved us: my insistence on a fixed-rate mortgage (not the adjustable-rate ones that devastated so many homeowners during the 2008 crash); and our insistence on buying a house that we could support on one income, though we had two incomes at the time. When my husband got laid off a couple of years later and the economy went south, we were able to stay in our home.
We paid off the place in less than 15 years, but the thing is: property taxes are very high here. Like $10,000 a year. Add in maintenance (new roof, tree work, replacing appliances, updating a 1970s kitchen, etc.), and I would bet that renting is actually cheaper.
I do like the quiet here, the spaciousness, and the ability to have our own yard. But some neighbor is always calling the township to complain that our lawn doesn't look like a golf course, and the upkeep of a house and yard will be beyond us eventually. My plan is for us to look at moving into senior housing or some kind of rental situation in about 8-10 years, around the time my husband is 80.
terrific post, thanks Sue!
I bought as a single person. I am managing. I don’t know that I want to deal with the property/upkeep into my later years but it is nice knowing my $$ is building equity. I do hope we don’t end up in recession. The last one, my last home ended up under water and I couldn’t sell for over a decade without losing money or costing me money. Thus my best advice is put down as much to lower your mortgage balance to start as possible. That last home, we didn’t do that, opting to pay the lowest down payment allowed so as to have $$ to spend—thus when I ended up with the house in my divorce, my mortgage was really high with 1 income. I managed but it was tight. Will never do that again!! This house, on my own, I put down a lot!!
The one sentence stands out for me…. I’ve done it and said to my friends, singles, try not to retire with a mortgage. My husband died nine years ago, I retired in 2022. Fortunately I had a good job and cleared my mortgage before I retired. No mortgage insurance for me as my husband’s health made it incredibly expensive.
The peace of mind is priceless
My stepkids bought out my share of the house, after my husband died. It wasn't a lot, but I kept looking for cheap housing. An internet friend suggested KS and I bought my house, sight unseen, for $28,000 three years ago. All it had to do is outlast me. It's small and simple, built in 1951. I will never be the old lady in the tent under the overpass.
Beautiful!
I think the two issues at the core are freedom and safety. Freedom to do what you want and the financial security to not feel like you are steps away from disaster. For some that is homeownership, for others it isn't.
As we age there is always the possibility that we won't be able to age in place so any plan has to be flexible. Things happen and there always has to be a backup plan.
So very true. I guess we should finish our declarations with "for now" because everything can change.
Hubby and I built our first home, where we currently live, back in 2002. We were both working fulltime back then. We were very lucky to be renting from a friend's parents and paid extremely cheap rent. We paid off credit cards, and saved up, putting 20% down, got a fantastic rate on 30 year fixed, from a local bank, well regarded. Both of us had only ever rented, mostly apartments. We liked the duplex we were living in before we bought but the neighborhood was going downhill fast. (Example, house across the street was raided for prostitution the week after we moved out!) We were able to refinance back in 2017, knocked 5 years off mortgage and lowered rate by almost half. Last summer we paid off the mortgage. It is such a stress reliever to own our home free in clear. Yes, there is upkeep involved but we're doing fine for now. Neither of us has ever made a lot of money on our jobs (me especially). I doubt I could afford anything on my own now rent-wise. Only regret, being in a HOA. They can be a real pain in the keister sometimes. We get nothing except a fancy brick wall at the entrance to our development for the money we pay.
Our home is 1700 sq. ft. and will be paid off in six more payments. Our first home was 1974 and we paid $33,950, it was almost as big as this home. In between, we owned two other houses that were larger, this one was a downsize but the cost was upsized! Our PITI is $1525, we could not rent for that, no way! I am so glad we have this house, had we not started young and worked our way up we could not have afforded to live here. Looking forward to being mortgage free and grateful that we could get into home ownership at a young age. I hope to stay here forever, and I take very good care of my health so that I can be independent for many more years. We live in an HOA community and our yard work is included in the quarterly fee of $615. Well worth it. I plan to leave this house to my daughter-in-law and grandson to pay for his college education. That is my big WHY for taking care of myself!
Well done!
Yes, and a bit of luck! I feel sorry for young people just starting out. A house like ours, bought used and with 20% downpayment, would cost the buyer about $7200 a month PITI and HOA. Yikes!
Yikes indeed.