Quickly paying off a house

[tazhunter0]

I know we should have someone on the GS that could answer this.

Still owe on the house : $67,000
Monthly payment: $715
Interest is 5%
Approximately 20 yrs still to pay

If a payment of $600 was sent in every month to go straight to principal, how soon would the house be paid off?


I have no idea if I will do this, it’s something I just thought about and was wondering.

[Throwin Darts]

What was the original loan amount? And did you start with a 30 year loan?

[BigCohiba]

You could cut your 20 years down to around 10. There are several online calculators that you can use to run various scenarios.

[tazhunter0]

What was the original loan amount? And did you start with a 30 year loan?

$85K
30yr

[oktx]

Get a lower interest rate?

[Bassdeer]

Get a lower interest rate?

Get this if you can, other wise yes $600 extra will cut it in half maybe more.

[sharpstick35]

refinance it to a 15 year. if you are making extra "principal only" payment, the interest rate doesn't as much. I was in a similar situation 11 years ago and was able to pay it off in 5. that freed me up to buy a second home and that house is now paid for and I'm working on paying off the land it's on.

[Biggs]

Refi that for 2% less

[Huggybear]

Depending on your age, I’d start a ROTH and pay 100$ more a month on your house note.

[Chad74]

Like mentioned above, I would think you could refi for 15 yrs at a lower % and keep close to same payment as now and then make that extra $600 a month payment and probably be payment free in 10 yrs or less

[TX03RUBI]

I’m assuming 715 is with escrow, as 85,000 at 5% for 30 years comes out to $456. Which means you’re only paying a fraction of that $715 towards principal. $600 extra towards principal would equate to paying the loan off 261 months early IF you paid that from day one. Not sure what I would be now, but it would still be very significant.

[Austin]

Only owing 67K the cost associated with a refinance it would take him 10 years to recoup those fees based on savings. Better off to just hammer on the principal and get it knocked out in 7-10.

The good news is you owe less on your house than most guys do on their trucks😳

[JonBoy]

I’m assuming 715 is with escrow, as 85,000 at 5% for 30 years comes out to $456. Which means you’re only paying a fraction of that $715 towards principal. $600 extra towards principal would equate to paying the loan off 261 months early IF you paid that from day one. Not sure what I would be now, but it would still be very significant.

This. At year 10 in the loan (you said you still have 20 years left on a 30 year note) you're only paying ~$160/month towards the principal. An extra $600/month plus the principal amount you're paying on your current payment you'll have it paid off in about 7 years...maybe a little less.

[M16]

You’ll never get your house paid off. Evidently the government owns my house. I’m still making payments to them every year.

[offthemap]

Depending on your age, I’d start a ROTH and pay 100$ more a month on your house note.

This.

You'll end up with a net gain assuming your investment earns north of 5% which should be no problem.