I do not “own” my home. Not by a long shot (Can you say, "no down payment?"). This label is thrown around like it’s some sort of accomplishment. All it really means is: “Congratulations, you signed up for a mortgage. Good luck that the housing market doesn’t suck while you “own” it and you end up owing more than it’s worth.”
We think mortgage debt is good debt because a house is supposed to be an investment or an asset. Plus, I suppose it also has that whole “American Dream” business wrapped up in it. Obviously, the economy and housing crash has sobered most of us when it comes to biting off more mortgage than we can chew. But if you were fortunate enough to escape foreclosure, or maybe are even still sitting on quite a bit of equity, it’s very easy to get complacent, blithely going about your business while those mortgage checks automatically roll out of your account out each month.
But when was the last time you sat down and looked at how much you owe? Even if you are lucky enough to have entered the housing market at a good time, and that set you on a path toward good equity or helped you eventually move into a larger, nicer home – don’t feel too smug. When was the last time you looked at the dollar amount of interest you pay every month? Not the rate; the actual cash you pay. Or how much interest you’ve paid so far? I’m sorry, but a tax break is a minor consolation here. To me, anyway.
We just (finally) refinanced to a 15 year mortgage last week. And for the first time, the amount we automatically pay toward our principle every month is actually more than the amount of interest we pay.
I think the term "Home Owner" should be reserved for people who own their home outright. And maybe I’ll be one someday.
Meanwhile, I need a new term for myself. Suggestions? Home Equity Owner? Piece of a Home Owner? Part-Home Owner? Mortgager?
Those stink. Please help. Thanks.