I don't think our mortgage history will reas like the average person's at all, hehe, but just had to share. Our mortgage balance will drop below $212k in the next month or 2. I was trying to remember what our very first mortgage was, thinking it was about $210k. So I was thinking, gosh we are almost where we started. Of course in the course of a year almost we paid it down to $200k because we made so much money back then, (double income, no kids). So really I won't get too excited until we drop below $200k. That will be a true milestone. It's almost frustrating that 7 years later we are barely back to square one (will be more like 8 or 9 years when we get there). I guess you get kind of spoiled with a 15-year mortgage, and going back to a 30-year later seems awfully slow going! But we are about to the point where our interest is less than $1k/month - and that is pretty sweet.

Anyway, since I could not remember off the top of my head I decided to grab my old escrow statements and see. It is kind of funny we have only owned 2 properties but just PILES of escrow statements because we refied our first place twice, and then this one once, plus 1 sale of the old property, saw was a lot to go through.

Our first home cost $259,950 to be exact. I think the asking price was $260k and that was what we offered - on our 3-bedroom condo in San Jose. Nothing grand, just one of the most expensive areas in the nation. The whole $500k fixxer-upper-house thing was not our thing, so we went condo instead. & well I think we were approved for $280k, so not sure we could have afforded much more. Apparently we put $56 cash down (including closing costs) and took a loan of $207,950 - a little lower than I remembered. Wow, that was just a scary thing, tying up all our cash and income - we were making $60k at the time combined, if that. But right after we closed we both got huge raises and that is why we were able to save so much early on. & well at the time (higher interest rates - we paid around 8%) our mortgage was $1500 but rent on the same apartment was $2500/month. We mostly felt like we had no choice.

Interestingly, the entire time we owned our condo, condos in the area were appreciating faster than houses in the area. Just too dang expensive. We thought for a while we may ride the equity wave up to a house, but even with the edge it became clear after a couple of years that we just were not willing to settle to have to pay almost $300k to live in an apartment and do the SAHP thing. So we decided to move.

Anyway, in the interim with our raises we refied to a 15-year loan and a much lower interest rate so we had a $1800 payment for a while. Maybe a year and how we paid off down to $200k so fast.

When we moved we had a grand plan to sell our condo for $350k, buy our new home (twice as big - with yard and garage and all that) for $260k, and so basically we were going to drop our mortgage down to about $100k. It was our plan - we could live on $40k easily and start having kids.

So we put our condo up on the market like 9/10/01 and of course 9/11 happened and the market tanked. We spent a little more on upgrades than we intended and so on and so on, but in the end we were so far ahead with the move, we went with it even though we could not even sell our old house. We refied once again and pulled out a good $25k for the down payment on our new home. We had saved up lots of cash to cover the difference. So there was refi #2. Lord knows what the payment was or how much we borrowed, but we had two $300k homes basically 80% financed for a good 4 months. It was fine with our income, but kind of scary all the same. Rents were insane still at that time and we probably could have rented the condo for $3k/month, which was our backup plan. Could have been very profitable (the condo is worth $450k today) but just not our thing - we never had any desire to do the landlord thing.

Anyway, we refied through a friend and 3 weeks turned into 3 months. We were NOT pleased, but it all worked out because the refi ended and we were able to put the condo back on the market the very week things seemed to turn around. (we had to borrow the cash from my parents in the interim for the down payment on the new home). Sold in a day for multiple offers. I actually heavily disagreed with how low our realtor wanted to put our home up and I think we compromised. Was a good lesson to me to hold my ground when I "know" - I watched the market in our area like a hawk, and the whole selling in one day thing kind of annoyed me as we could have asked a few thousand more. Oh well, live and learn, we were just glad to sell...

Our new home was 2 hours away, but twice as big, and my new job actually paid better (when all conventional wisdom said I would have to take a 10% pay cut - but I got a 10% raise instead - in benefits and such).

So we paid $287k for our new home, which was absolutely our dream home. We were only 23 or so at this time. Put around $57k down, and also paid cash for some landscape upgrades - probably paid a grand total of $295k. It always struck me though because dh and I are VERY particular when it comes to housing, but the 2 homes we ever bought were both priced $260k "as is." That's our number I guess. For the longest time we said we would never ever pay more than $300k for a home, but we never had much equity before either. These days we would pay a lot more - maybe twice as much - to make a lateral move and keep our same mortgage. But I think $230k is most definitely about our mortgage limit, which is pretty low for California. We pretty much refused to play the game. A $500k mortgage never seemed worth the stress, no matte what benefits it could bring (being closer to the beach and to family??? Eh, not worth it). Well we ended up paying more than the $260k on this house but we got a whirlpool and granite countertops and all that stuff. We actually were pretty frugal in our upgrades, a big chunk was converting part of the garage to dh's beloved theatre room, but we had a lot of custom fixes done around the house - which pretty much spoiled us - nothing like buying a house and tweaking it to just how you want it.

Anyway, so the mortgage on our twice as big, and 10 times as fancy, house, was $1500 - back to square one. With the whole 2 house thing we went back to a 30-year mortgage.

In the meantime interest rates were still falling but I was so sick of buying/selling/refi, I just didn't even want to touch it with a ten-foot pole. Again, maybe my resistance paid. Finally a month before my first son was due I gave in and we refied down to a lower interest rate and a $1300/month payment. Just about the lowest interest rates ever got.

Anyway, I think it is quite ironic that our first condo was originally a $1500 mortgage and now we pay only $1300 though we owe much more...

So we have paid our way down from $230k to about $212k over the last 5.5 years. Not bad, as we are starting to make real progress.

So anyway, when I get annoyed about how excessive our house must be or how big our mortgage may seem to others, you see why. We have bought ourselves such a simple lifestyle by moving to a cheaper area. We may have more but it cost a hell of a lot less. In fact when we moved, even our insurance was cheaper, property taxes were the same, etc. These days not so much as things are just as crazy here today as what we tried to get away from. Blah. But I feel so blessed we just jumped in when we were young. You don't know how many people told us we were crazy to buy at the "peak" in 1999 & absolutely crazy to pay almost $300k for a house in Sacramento in 2001. A house that was worth $500k in 2003 and $650k briefly in 2005.

We've looked at what we could buy in San Jose these days with our equity, and it just ain't much. A fixxer-upper, 3 bedrooms if we are lucky, and the joy of doubling our property taxes to $8k/year. (Not to mention insuring such an expensive home). IT just will never happen.

I think luck and timing has paid a huge part in our success. But the thing is we could just dwell on the fact that we didn't end up with the $100k mortgage we had planned. That is too bad. But a lot seemed to go right for us all the same. Not much to complain about here. I always find it ironic when people from the area are jealous of are home and assume we are "rich." 9 times out of 10 they are paying more to rent an apartment or for a mortgage on a house 1/2 the size. It's always a little weird. Like people don't remember you could buy a decent house in Sacramento for $100k just a decade ago. Dh's cousin bought a 4-bedroom home here on 1/2 acre around 1999. It is just insane - the same house costs 4 times as much today. If we hadn't of moved when we did we certainly wouldn't have had it so good. Sure we put a lot of cash down on our home and saved up a lot of cash while we were young. But I know plenty of people buying the same houses today with 0% down. No, it was buying early on that was really key for us.

So we have upgraded our house and downgraded our payment over the years. & that I must say is pretty sweet.

Sometimes I think if we weren't so blinded with our buying power, maybe we would have just settled down with a much more modest home. But most of the time I think, eh, you only live once. IT would be one thing if we were mortgage to our eyeballs for a house like this, but frankly it was way less than we ever expected to pay on a monthly basis for a home no matter how modest, no matter if we just rented an apartment. So I guess that makes all the difference. We could have, but I don't think we have done 1/2 bad regardless. I look forward to the next decade as my income grows and our mortgage shrinks in proportion to inflation. I like looking at my budget and knowing that is one expense that will not increase with time - phew! In fact it is almost like it is a shrinking expense as less goes to interest every year. woohoo.