Mortgage free sounds wonderful. If you have been following the essential steps, you are to the point where you don’t have debt, your retirement is secure, and you are ready to payoff your mortgage. Some people might be wondering what happened to saving for my children’s college. My answer is nothing. You are not obligated to pay for their college. You certainly don’t want to co-sign for their college loans. By the time your children are ready for college, they are adults. If they want to go to college, they need to figure out how to pay for college.
They need to work and/or get scholarships or grants in order to pay for their college education. It might take them longer to finish their college degree because they might not be able to carry a full load and work. However, they will graduate debt-free. Nowadays, a college education is not going to guarantee your child a great job when they graduate. Your children might be better off not going to college. There are certainly plenty of careers that pay well and do not require a college degree. So no, I don’t think parents need to pay for their children’s college education.
Instead, attack the mortgage. Start paying more each month towards the principal not the interest. Always, make that very clear to your lender. Otherwise, they will pre-pay the interest. Doing that does absolutely nothing for decreasing your mortgage. Apply it towards the principal. Some lenders might want you to write two checks. Others might be okay with you just noting it on the coupon. Just ensure that the extra amount you are paying each month is being applied directly to the principal loan balance.
Also, don’t fall for lenders who offer to set-up two payments a month for you, so your mortgage goes down. The lenders usually charge you for setting this up. You do the same thing by sending in the extra amount each month. Before long, your mortgage will be decreasing. More of your money will be applied towards the principal and not the interest. Soon you will see that you only require one more payment to be mortgage free. Always, double-check with your lender to ensure the correct amount of the final payment. Once they give you the payoff amount, send in that amount. You will be mortgage free!