Friday, June 18, 2010

The 40 Year Mortgage

The 40 Year Mortgage Can be Daunting.

About 12 years ago, I signed a 40 year mortgage to my home and my wife and I celebrated by opening up a bottle of champagne and having a nice dinner.

The next day, I began thinking about how long that actually was 40 years before our home was paid off and I felt a little bit overwhelmed. I was not even 30 at the time, and my wife and I had only been married for a few years, and I really begin to have some doubts about whether or not I was ready for that kind of commitment.

I really could not complain about the deal we got with our 40 year mortgage in terms of our payments. They were very reasonable, and we knew that we could afford them each month and still have money to put back for retirement, recreation, and eventually starting a family. I just started thinking about the things that could happen, and I became concerned.

What if my wife or I lost our job, or had some type of situation where we became sick or injured and could not work? What if the neighborhood started to go downhill with crime or other problems? What if we started to find all kinds of problems with the house that we had not discovered initially, and ended up putting a bunch of money into repairs?

With a 40 year mortgage, it felt like were locked into a deal that could end up turning out disastrous for us, so I decided to talk to my parents, who were about three years from paying their mortgage off. I expressed my concerns about all of the things that could go wrong, and they presented a different point of view.

They pointed out to me that, while a 40 year mortgage could be a bit daunting, it could also be a relief, because we had committed to a house, and would have to make it our home. They also pointed out all of the great memories that would be established in the home, and how much my wife and I would grow to love our house and take ownership in it.

They also said they had the same reservations I had when they first signed their 40 year mortgage, and were still living in their home, and would never leave. I started to remember why we had signed the mortgage in the first place, and I felt much better.

It has been more than a decade since we signed our mortgage, and I don't even think about it any more. I have lost a few jobs in that span, and my wife has as well, and we always pulled through. We have two children now and we could not imagine living anywhere else, and the neighborhood is still a great place to live.

A 40 year mortgage can be rather daunting when it is first signed, but after you've been in your home for a while and realize what it provides you and your family, it feels more like a blessing.

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