:) Archives - Page 333 of 491 - Blogging Away Debt Blogging Away Debt

Does a bi-monthly payment make a difference?

I’ve become far less concerned with my credit score since I purchased my house last year. But I still do follow a couple of credit repair or best practice experts and based on their advice and posts, keep an eye on what I’m doing. One of the things I see consistently is to make multiple payments a month. This not only positively affects your credit score, but also cuts down the interest you are paying.

Even my mortgage company offers this as a pre-set option, essentially breaking my monthly mortgage payment in two. Instead of paying $660 per month, I am paying $330 every two weeks. (I love playing with their amortization calculator to figure out how extra payments and such affect my mortgage in the long run.)

While I don’t have to “worry” about my credit score anymore with no need for credit/debt, I do still want to improve it while at the same time continuing to climb out of debt. I doing pretty well at other strategies like keeping my credit card debt under 30%, easy to do when you are paying it off every month, not applying for new credit and paying bills on time.

I guess my question is twofold:

Does doing bi-monthly payments, specifically on your mortgage, really make that big of difference in the grand scheme of things?
Does doing bi-monthly payments on other debt do the same thing? (I know it won’t make a difference on my medical debt as those are interest/fee free.)

I’d love to know if the strategies these experts harp on real or if they are just blowing smoke. No, I have no need of a credit repair service. But I am still working to gain knowledge.

I would love the BAD communities thoughts on this strategy that seems to be a positive for 1) decreasing the interest you pay in the long run and 2) increasing your credit score somehow.

Hope

Hope is a resourceful, solutions-driven online business manager with over two decades of experience helping clients streamline operations, manage projects, and grow their businesses through digital marketing and technology.

But life has a way of rewriting your plans.

A year ago, Hope made the decision to move in with her aging parents full time – a season she wouldn’t trade, even as it came with its own financial and emotional weight. Earlier this year, she lost her mother, and is now walking the tender, disorienting path of grief while learning what “forward” looks like from here.

Hope came to the Blogging Away Debt community in 2015 as a single mom raising five foster and adoptive children. She’s written through job changes, financial setbacks, and the bittersweet transition to an empty nest. Her kids are finding their footing in the world now – and so is she.

Rooted in faith and fueled by the same perseverance she’s brought to every hard season, Hope is ready to face her finances with fresh eyes and an honest pen. She believes that clarity, courage, and community can change the trajectory of anyone’s story including her own.

She lives in Austin, TX with her dad, loves adventures with her dog Addie, and is figuring out, one step at a time, what this next chapter is meant to be.

How Much is a Paid For House? A Lot.

by Beks

I have been brimming with excitement at the thought of being completely debt free house and all. This was going to be everything I dreamed and more. I’d walk in the yard and it would feel amazing knowing that I own every blade of grass. I’ll be able to save TONS of money obviously because my homeownership bills will be SUPER low!

I’ll be silent for a minute while you hold your laughter.

I’ve always used impound accounts through my mortgage company to pay property taxes and homeowners insurance. I have precisely zero clue how much these things cost because I’ve never seen a bill in the 14 years I’ve been a homeowner. Obviously, I expected these expenses, I’m not a complete moron (close but not complete). I guesstimated they’d be $400-$500/month. Based on what? Not a lick of evidence or research.

Not surprisingly, I was wrong. Like. REALLY wrong.

Texas doesn’t have income tax. Let me tell you friends, there is no such thing as a free lunch. They’ll get you somewhere. Everyone makes jokes about Californians being taxed to death but my property tax was 1%. Wanna know what it is in the great state of Texas? 2.2% plus additional assessments and fees. Yup, more than twice my Cali price.

But wait! There’s more! There weren’t a whole lot of chances for natural disasters in my neck of the San Diego woods. I wasn’t near a wildland area so wildfires were a very low probability. There are no weather events to speak of either. Well, occasionally, you may get sunburned. AND, I lived a mile from emergency services and a fire station. Earthquake coverage is a separate policy and most folks don’t have it because it’s unaffordable so we all cross our fingers and hope ‘the big one’ doesn’t hit. Homeowners insurance was cheap. Really cheap. In Texas? I had to drink a very large glass of wine after getting a quote. Turns out, Texas homes are suspectable to wind, hail, flooding, fire, freezing, and locusts. OK, not locusts but it seemed fitting since Texas has all the other plagues. My homeowners insurance? More than twice my Cali price.

You thought that was it? Oh no friends, there’s more. Yes, I’m beginning to sound like a crummy infomercial. We are buying in an HOA. I’m torn about this. I’ve never belonged to one but I’ve never been a fan…until I got some terrible neighbors in San Diego. Those few bad apples made the entire neighborhood look bad. But HOAs aren’t free.

So what does a debt free house cost? Over $1,000 a month. More than twice what I thought it would. I know it makes me sounds like a total whiner here but I am really surprised at that number. There is some good news though, it’s less than half what we were paying. Whew.

Beks

Beks is a full-time government employee who enjoys blogging late into the night after her four kids have gone to sleep. She’s been married to Chris, her college sweetheart, for 15 years. In 2017, after 3 long years working the Dave Ramsey Baby Steps, they paid off more than $70K and became debt free. When she’s not working or blogging, she’s exploring the great outdoors.