After buying my latest primary residence, I now have four mortgages. Three mortgages felt OK since one was a primary home mortgage, the other is a vacation home mortgage that produces income, and the last one is a rental property mortgage that is cash flowing nicely. But four mortgages feels like too much, and I plan on doing something about it by paying one off!
I’m sure only a small minority of you think having four mortgages is OK. Even though being leveraged in a rising real estate market is good for building net worth, eventually the good times will end.
What’s interesting about personal finance is that we all have different levels of risk tolerance. Some people aren’t comfortable with any debt, hence they don’t borrow anything. I admire such people for their ability to live thoroughly within their means. Other people let lifestyle inflation get the best of them and take out massive debt that is not comfortably supported by their income. Obtaining credit is so easy in America. The only people who annoy me are those who expect others to constantly bail them out.
One of the curiosities about debt is the joyous process of getting into and out of debt. There’s a certain thrill of buying things with debt. Everybody wants something they can’t have or fully afford, including myself. Then once we reach a maximum debt limit, it’s almost equally as fun getting out of debt. Each $1 that is paid down feels like a victory. We tell our friends about our progress and look like heroes. It’s a win both ways!
This post will review my thoughts on the ideal mortgage amount based off the ideal income amount, discuss the history of my first mortgage, share more reasons why I’m paying down that mortgage, and my new mortgage pay down strategy.