Saving Money: House Payments

I have always been a saver. Not sure why, but I was not the kid that spent my money on candy or toys. I saved everything. I would find pennies on the ground and pick them up. To some, it isn't worth their time, but to me every penny counts. I even pick-up pop cans if I see them lying around. 10 cents is 10 cents. It may not seem big, but small things add up. A few pennies here, a few haircuts there, and bamb, I've saved hundreds of dollars. But today is not about saving pennies. No my friends, today is about saving thousands. We are talking about house payments. Exciting right? Maybe not for you, but there is something that fires me up about saving money. So here it goes.

We bought our house for $65,000. It is in town and is nothing spectacular. It is small, but perfect size for us. Our interest rate is 6%.

We have a land contract because we were not able to get a loan from the bank, which is another story for another day. Stupid Banks It's their loss, not ours.

Our land contract was set up as a 15 year mortgage with monthly payments of $549. So here are the hard facts about the different mortgages.

                   Monthly Pmts         Interest         Total 
 30 year              $390                  $75,296       $140,296
 20 year              $466                   $46,763       $111,763
 15 year              $549                   $33,732        $98,732
 10 year              $722                   $21,596        $86,596
 5 year                $1,257                $10,398        $75,398
 3 year                $1,977                  $6,187         $71,187

If you have a 30 year mortgage on a home that cost $65,000 at 6%, you can plan to pay $140,296 for that house. Now your payments are only $390 a month, which does look appealing, but if you can manage to pay $549 (not even double), you will save over $40,000 in interest and 15 years of house payments. And the track we are on is the 3 year track. We are paying as much as possible, almost $2000 a month. I know this isn't feasible for everyone, but if you can it is worth it.

In order to make this happen, Kenny and I have had to make some sacrifices.

Things we don't have or do without:
1. Internet
2. Cable TV (rock on antenna)
3. Netflix (you can get all the free movies you want from the library)
4. Food (we cut coupons and eat fresh grown items from gardens along with canning extra food)
5. Nice cars (we have never had a car payment; we have never had a nice car)
6. New clothes (90% of our stuff comes from Christmas presents or stuff that's given to us)

By sacrificing these things, we are able to pay as much as we can on our house. By doing it in 3 years instead of 15, we will save $27,545 in interest. I can think of some amazing things to do with $27,545!

This is not to say we don't have fun. We have date nights and put money back into the house, but we try to cut down on how we spend money on things we don't need.

Would love to hear any cost saving tips you have!

Nicole