How To Pay Off a House

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Just a couple weeks ago Megan and I had the great delight of reaching one of our loftiest goals: completely paying off our house. It was a long 2.5 years, but now that it’s behind us it’s one of those things that feels even more worth it in retrospect.

And we never have to make another mortgage payment ever again, which is definitely a bonus!

I’ve been thinking a lot about our journey to debt freedom, and since I love to write, I finally decided to put some of those thoughts down. I am always hesitant with these types of things since the last thing I want is to come off as braggy. And while we are incredibly proud of what we’ve accomplished and equally grateful for all the ways God has blessed us, we also think that maybe there is something in our story and journey that can encourage and inspire others.

The Story

The Beginning

In many ways our journey started before we ever bought the house, and even months before we were married. Just about two weeks after getting engaged I was diagnosed with a relapse of lymphoma. It had been nearly 20 years since I had last faced cancer, so it was something that was far out of my mind, something that was as likely as not to never happen again. I was confused and scared and uncertain, and even thought about calling off the engagement because I didn’t want to saddle Megan with such an uncertain future. But she is stronger and braver than I am, and basically told me to stop being stupid; we then buckled down and worked our way through the chemo and into remission.

I would certainly not wish that experience on anyone (including myself!), but in many ways it was a huge blessing as we were preparing for marriage. It gave us the opportunity to face intense adversity together, to work hard in the midst of severe obstacles and get through to the other side. We learned to rely on each other and to have our hope completely in God, rather than in him making our circumstances as we would want.

This was important because- to put it rather crassly- if you can get through the crap of cancer together, you can probably get through anything. In a lot of ways other problems and obstacles seemed to pale in importance in comparison, and all that we learned through that experience really helped to forge our marriage, even before we made our vows.

Getting on the Same Page

Remission finally came, and weddings bells were ringing in the distance. It was only a month or so before our wedding, and I still had some baggage that Megan wanted me to take care of- my student loans.

It wasn’t much- only about $7,000. But I had had them for nearly 6 years, just dutifully paying on them without giving it much thought.

Before I met Megan I was actually pretty bad with money. Granted, I didn’t really overspend, but I didn’t really budget either. Megan definitely helped me turn that around, but before we got married and combined our finances she- how shall I say this- strongly intimated that I needed to pay them before the wedding.

The sad thing is that I had had the money to pay them off for quite some time, and paying them off wouldn’t have put me in a financial bind by any means. But I hadn’t yet learned about being intentional with my money, and so I was just coasting along with payments by default.

Megan finally convinced me to pay them off (and it didn’t actually take much convincing), and so we were able to start off our marriage debt free. But even more importantly, we started to really get on the same page about our finances. That doesn’t mean we were fighting about money prior to this; rather, it was more that Megan was very conscientious about money and planning and spending, where I was not. In Dave Ramsey language I might be termed the free spirit, although I never considered myself to be that. I figured that as long as I had the cash to buy something and spent less than I made, I was doing ok.

And to be sure, I wasn’t in financial trouble. However, there wasn’t any intentionality to what I was doing, and this was keeping us from being on the same page.

I’ve learned a lot from Megan about money since then, so much so that it’s quite difficult for me to look back on myself and how I wasted so much time that I could have been doing more, giving more and saving more.

But getting on the same page with money was very important since it helped to bring focus to that aspect of our marriage, and by extension helped to strengthen other areas as well. We had learned to work together through my bout with cancer, and we began to apply that same teamwork to our relationship with money, which helped us to be able to save and give and prepare for the future, which was soon to be a rocky one.

A Year on the Rocks

For the first year of our marriage we were both working full-time, and since we had a small and relatively inexpensive apartment we were able to make and save what at the time seemed like an insane amount of money. We had even talked about buying a house with 100% down. But things were about to get rocky and put everything we had worked through and worked towards to the test.

In the course of my regular follow-up CT and PET scans some areas of concern were discovered in the Spring of 2011. Multiple biopsies proved inconclusive, and so we went through a several month ordeal of multiple tests, biopsies, uncertainty, and lots of waiting.

Eventually that summer a biopsy came back positive, and so for the second time in our relationship we were facing cancer again. During the first round the chemo hadn’t been so bad, and I was able to pretty much still work full-time. But this time more aggressive treatment was needed, which would prove to take me out of full-time work for nearly a year.

On top of this, Megan had left her job a few months earlier, which made the future even more uncertain. Due to my stem-cell transplant, during the recovery I basically had to have full-time care. This meant one way or another Megan had to be at home to care for me, clean, and basically do everything since I was effectively useless. Thus, we would have little-to-no work income coming in, and had to go through the process of waiting for disability (60% of our then income) to be approved and disbursed.

It was a tough year. Fortunately, I had accumulated a lot of sick time and had a few weeks of vacation I hadn’t yet used, so we were able to stay at our regular income for awhile, which was a blessing. But eventually that ran out and we were on disability, which was made even more difficult since we had to drive to the doctor almost every day, spend at least three weeks in the hospital, and buy only specific types of food.

Fortunately, Megan is absolutely amazing with money and budgeting and completely rocked the whole thing. We fortunately had a fairly healthy emergency fund, but Megan was able to pay all the bills without ever touching it (to this day I am still in awe). And since I was essentially in reverse quarantine mode, we basically did nothing that year. I got to stare at the same four walls of an apartment living room for that year, and I think Megan only went out to eat twice that entire year. Eventually I was able to start working part time again (which was not easy!) for a little while, which helped ease some of the tightness of the budget until I was able to get back full-time.

I know that I learned to trust Megan implicitly with our money, partially because I had little choice but mostly because she was incredibly focused and willing to do what needed to be done to make it work, even though I know that whole year was hell for her.

Getting A House

As 2013 approached I had been in remission and had been back at work. Our independent contract work had also picked up significantly (due to Megan’s tireless efforts, networking and business prowess), and so we had been able to start saving aggressively again for a house. We still entertained the notion of doing 100% down, but due to other circumstances involving my health decided that getting into our own place where we’d have more control over the environment would be a good idea.

It was finally in March 2013 that after months of searching we found our house and signed the paper to purchase. For me it was a bittersweet day (and probably too for Megan), for although I was happy to have the house, I also hated the risk that any kind of debt entails. It wasn’t long after moving in, however, that we began to really talk seriously about paying it off, and fast.

With the pick up in our side work Megan started running some figures, and we found out that if we were really intentional and aggressive with our payments, we could be done with the mortgage by the end of 2017, somewhere around a payoff of five years. We had a 30 year mortgage, but neither one of us had any intention of going that whole term.

Really Getting a House

In Summer of 2014 we were making really good progress, and had been able to pick up a few more clients which helped to grow our side work even more. We were eager to get the house paid off, and as we ran more numbers the payoff date was getting shorter and shorter. Eventually we set an audacious goal of paying it off by the time we went on vacation the following summer. As checks came in and the payoff balance dropped more and more, we got really excited and motivated.

Unfortunately, that payoff date didn’t work out (some things came up, as they always do!), but our new and probably actually attainable goal was to finish by the end of 2015. Two and half years earlier we never would have dreamed we would have been talking about paying off our house in 2015, but now we were beyond excited and extremely determined to do.

But things continued to pop up, and money had to go to other things as the summer wore on into fall. There were some weeks while waiting on checks to come in that it seemed like we might not make our goal. But as October came and went, a couple big projects came in which helped to make up the shortfall, and we were now looking at sometime in November.

The first few weeks of November were frantic with work and holiday preparations and family engagements. We were able to make our penultimate payment a couple weeks in, which was hard because we were now so close. All we were waiting for were a couple checks that would give us enough to make the leap and be debt free!

We came home for lunch one day and I went to the mailbox as I always do, hoping and praying that the checks would be there. That day- they were! For the entire time that we had been paying down the mortgage, it at times didn’t feel real. It was just numbers on a bank statement getting smaller year after year. But now I held in my hands the payoff amount, and it was awesome!

The day before Thanksgiving Megan took the day off to make some last minute preparations and to get the things together we needed for the payoff. I went into work as usual, finishing up some things before the holiday break, knowing that at lunch it would finally be over.

As we walked into the bank lobby and settled the account, I guess I’d have to say I didn’t exactly feel any thrill or anything different; really, it was just another transaction. Intellectually I understood that we were done and what that meant for our finances, but it hadn’t yet sunk in.

But now that we’re a couple weeks on the other side of it, the reality is finally starting to catch up with my mind. For me it’s not really a giddy “we are debt free!” kind of thing; rather, it’s more of a peace of sorts. To be rid of the risk that debt represents is huge, and in many ways it changes the way I now perceive our finances and what we can and should do with them in the future. To know that we can’t be foreclosed on, that all the equity in the house is ours if we ever move; those kinds of things are worth the sacrifice and the investment.

The Nuts and Bolts

Sacrifice

An integral part of our debt payoff plan was a decision early on in our marriage to live on only one paycheck. This meant we often had to say no to things that we wanted, but even then we never had to really go without. The things we decided to give up were newer cars, home improvements we really wanted to make, and (at least for awhile!) a newer computer for me. We certainly could have afforded them, but our goal of paying off the house was bigger than them, and since we were united in this goal it was easier to do without those things in order to accomplish something better.

But more than stuff, we had to sacrifice a lot of time. We both worked insane amounts of hours over the past 2.5 years, and at times the wear of it all was hard to bear. But one of the reasons we were willing to sacrifice a couple years of our time was so that- by paying the house off- we could be in a more secure financial position and be able to choose what to do with our time more freely in the future, since our financial obligations would be lessened. Added to that was the notion that the sacrifice and pain was all temporary.

None of this means we were sleeping under a bridge or eating dog food every other night. We were still able to give regularly to those in need and invest for the future. We took vacations that we hadn’t been able to because of my health problems. While some of the things we had to give up or do without weren’t convenient, we don’t feel as if we have been shortchanged or missed out on anything.

On the contrary, we have discovered that when we are both focused and working towards the same goal, we can work together and sacrifice to get there.

Planning

I know that in the beginning I wanted to pay off the house and was definitely on board with it, but I didn’t really yet have the tools to know how to get there. That is partially because I have never been that great with money. As I mentioned previously, I’ve never been in serious financial difficulty, but I’ve also never been intentional with my money. I always had the notion that as long as I didn’t overspend, I would be ok. I had no idea how to plan for the future as far as money and investments are concerned.

And to be honest, some of that was some really bad theologizing on my part- or at least rationalizations cloaked in that garb. I convinced myself that if I didn’t care that much about money or spend much time thinking about it or planning with it, then I could avoid its snares and not end up falling into debt or becoming materialistic or whatnot.

I have always heard the parable of the talents, and wondered how the servant who buried his talent in the ground could have done that. I mean, who does that? Eventually I came to realize that by not being intentional with my money, I was effectively burying my talent in the ground by default. I learned that my money isn’t really my money; rather, I am a steward of it. And since that is the case, not only is it wise financially to plan and spend wisely, it is actually a moral and spiritual obligation.

That shift in my thinking changed my perception of money and helped me to become a better steward. As my perceptions I changed, I realized that in my quest to not be consumed by money through not planning I was actually doing the exact opposite. Many times I would fret about the future and wonder how I’d live if I lost my job, wondered if I’d have enough money to buy this thing or that, wondered if I was giving enough, etc. Instead of not being consumed by money, it was in my thoughts an inordinate amount of time because I was so unfocused and unorganized.

I am still working on this, to be sure, but Megan has helped me to think more intentionally about money and actually plan its use before we ever get it. As we were paying off the house, it didn’t happen by accident. Every month we had to determine how much money was coming in and where it was going. It also meant we had to plan for larger purchase well in advance, which sometimes meant foregoing them to work on the bigger goal.

But as this process was unfolding, I began to find myself becoming less consumed with money the more I planned its use. Instead of being led along by it and all the worry that can be associated with it, I began to find peace since we had a handle on our finances and were telling our money what to do. It’s hard to describe how that has affected me, and while I sometimes still find myself slipping into my old thought patterns and habits, consistently having to think through these things and plan strategically has given me more financial peace than I have ever known before.

Avoid Debt

We have both always been averse to debt, and though we reluctantly took out a mortgage, we did our best to make the arrangement as advantageous to us and our financial position as we could. We put down a hefty down payment, both to lower the loan amount and to avoid PMI, which helped our monthly budget. We also kept the monthly payments under 20% of our income (based on just one paycheck) for the same reason. We could have been approved for a loan of about double what we got, but we intentionally built in a large margin by only basing all of our calculations on one paycheck, with all the side projects and other income as extra. We also kept a well-funded emergency fund in case of job-loss, unforeseen medical expenses and the like.

Since we had no debt going into the house, we were in a much more secure financial position, and we definitely felt that. Since we had plenty of margin, when things broke or had to be replaced it didn’t have to be an emergency but could be cash flowed out of our surplus. It was about six months after we moved in that we really started to pay down the mortgage aggressively, throwing everything we could at it.

We fastidiously avoided credit cards like the plague. I’ve shared my experience with them before, and I had no wish to have the same experience again. We knew that minimizing monthly payments would help us accelerate our house payoff more quickly, so we also went without getting a newer car, even though ours were both fairly old (I had a 97 Saturn, Megan had a 2001 Corolla). Eventually we even downsized to one car to save even more money.   

Hard Work

One of the hardest things we did over the past 2.5 years was to work like we had lost our minds. There were a lot of long days and late nights, all-nighters, long weekends, etc. We were taking work anywhere we could find it originally, which meant practically working all the time. This often meant that our time together had to be modified from the date types of things or whatnot that might be associated with time together. We would talk through concepts, design ideas, help each other create artwork, create invoices, etc. It was a crazy couple of years.

But we learned to work together well, and we also learned to be selective about our work and how to better run our side work so as to maximize the ratio of time to be free. It helped us to develop long-standing relationships with some great clients.

More importantly, we learned that we have the ability to really push ourselves towards a goal, and that we have an ability to succeed in our work. It is not easy by any means, and it has meant a lot of sacrifice, but there is a lot of peace that comes with that as well.

Giving

Giving has always been important to us, and from the beginning of our marriage we have been intentional with the amount that we give and where it goes.

It definitely wasn’t always that way with me. I’ve always tried to give, but I had many of the same poor assumptions about it as I did with money. For whatever reason I had this idea that genuine giving is always spontaneous, and that if you plan it then it just becomes something that is rote and unfeeling.

But Megan also helped me in this area, and eventually I learned that I was inverting my relationship to giving the same way I was with budgeting. There is nothing wrong with spontaneous giving, of course, but for me it was coming more out of a sense of guilt than of joy and love and desire. I wanted to give, and I knew I should give, but because my understanding of money was so poorly formed it was at least a partially toxic relationship. I would tell myself I was giving spontaneously, but in reality it was probably more me giving irresponsibly.

I wasn’t as concerned with how my giving was being used as I was with the assuaging of guilt and the catharsis from the act of giving. I’m sure there was a fair amount of sincerity mixed in there, but I eventually realized that in the same way that I am a steward of the money God has given, so also I am a steward of my giving.

As I began to give more intentionally, I found more joy and satisfaction out of it. It wasn’t a rote thing at all; rather, the discipline of consistently giving and being intentional about what my giving was for helped to change my perception of giving to a more healthy one. Before I would merely give as the feeling gripped me or as a plea for funds came in; now I am more cognizant of using that giving as responsibly and conscientiously as possible.

The end result is that since we got married, we’ve had a plan for giving. And now, I can (and am) actually giving more. And since there are now no financial obligations, the ability to give spontaneously as God directs is actually much more of a possibility.

The End of the Beginning

There’s an episode in The Office where Dwight quits Dunder-Mifflin and is looking for a job. While in the midst of the hunt he says “There’s nothing on my horizon except everything.” I think that sort of sentiment captures a little of the feeling of having accomplished this goal more than anything. In reality, it’s not just about getting rid of risk, accomplishing a goal or owning a house outright. Rather, the greatest reward (as far as I’m concerned) is this new-found sense of greater opportunity and possibility.

After all, we now have no payments for anything, which means that those kinds of financial obligations are no longer part of the equation. There is an unquantifiable sense of freedom that gets past the numbers and the math and is really more about a weight being lifted and laid aside.

In the end, we didn’t pay off the house simply to pay off the house, to meet some kind of goal or to get rid of all our debt. All of those are great things, certainly. But the real reason we worked as hard as we did to do this was precisely for that freedom in which we now have more choices. While finances always figure into everything, we can now begin to set goals and make decisions and plans based on the opportunities that present themselves, rather than figuring payments into whatever we might decide to do.

We definitely feel blessed to have been given this opportunity to reach this milestone, and I hope that the end of the beginning of this story can inspire anyone reading this in their own journey.

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By deviantmonk

Jason Watson

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