We have some exciting news to share! Yesterday we paid off another entire loan! In fact it is our 3rd of 4 loans, and the biggest loan we had! It is so encouraging to see another loan crossed off our list as we work at becoming debt free! It definitely isn’t easy, but we are working hard and kicking our loans to the curb. Here’s what we’ve done since May 2015:
In a little less than 2 years, we have paid off $68,591 of debt after borrowing $74,577! We have also obviously paid quite a bit in interest! $10,482 of the $68,591 unfortunately went straight to interest…
The purple loans are all the loans we’ve paid off, and Jacob’s government loan is the one we just finished yesterday. It was quite hefty, but we did it! While we’ve been working on paying extra to Jacob’s federal loan, we have been paying minimums on my government loan (in orange).
The current balance on my government loan is $18,460, and while this is very doable, we’ve decided to take a brief pause…
As you may know, Jacob and I are currently living with my parents. We pay them a little bit in rent each month but it has enabled us to put a lot extra to our loans for the last few months. When we moved in, we told my parents that we’d be with them for just a year. Therefore, we are planning on moving out in the fall. We have two options then: to rent an apartment or buy a house.
The rental market in Portland has been crazy! We moved out of our 1 bedroom apartment outside Portland because the rent went up to $1300 a month. So by the fall we could have my loan entirely paid off and move into an apartment to rent for $1300 a month. Or we could save up for a down payment and buy a house with a mortgage around the same cost as a one bedroom apartment’s rent. Right now, we are aiming to do the latter. This isn’t anything set in stone, but we want to be prepared if the right house comes along in fall. If we get to the fall and the timing doesn’t feel right to buy a house, then we will throw everything we’ve saved straight to my loan. We just want to be prepared for the option if it comes available at that time.
If we do end up buying a house in the fall, this means that we will not be fully debt free. But after we’d have a house, our plan is to still be gazelle intense and pay it off as fast as possible. Hopefully in less than a year. Ideally, we’d like to be debt free before having a house, but we would also rather not move into an apartment this year to buy a house and move again a year later. Again, nothing is set in stone about buying a house, but we do want to be prepared if that is an option! It would be such an awesome blessing if we were able to do so.
So that’s our update! I’m very proud of us and how we’ve been so diligent about paying off our loans! And I’m so excited to celebrate the fact that another loan is completely paid off!