Screenshot of ‘account summary’ page on the Wells Fargo website. (I’ve blurred out any identifying information.)

I don’t often talk of our personal finances on this blog, for multiple reasons — including privacy — and when I do, I rarely get very specific. But my wife and I celebrating a huge milestone in our lives together and I wanted to share the joy.

The day we signed the papers to buy this house, back in August 2010, we had a loosely defined goal of “12 or 15 years” when we guessed how long it would take to finish paying off our 30-year mortgage. We knew we wouldn’t simply make the monthly payments.

The following spring, we took advantage of the American Recovery And Reinvestment Act of 2009, signed into law by President Obama after being passed by the Democratic congress. It expanded the first-time home buyer tax credit introduced late in Bush 2’s last term, and Obama later extended the tax credits to cover 2010 home purchases. So, not only did we buy when interest rates were scraping rock bottom — the lowest of my lifetime — but we got in just in time to take the tax credit that ended just after we bought our home.

Many Americans who received that tax credit simply spent it; my wife and I dumped all of it back into the mortgage to bring down the principal. Also, the first couple of years, we paid every four weeks (instead of every month), until those extra days added up and we were more than a month ahead of schedule. Each spring when we recieved our income tax refund, the majority of it was dumped into the mortgage, and every month we paid more than we were supposed to — every time there was an extra dollar.

We were told that most borrowers take 18 years to reach the point where each payment goes more toward principal than toward interest; it took us only four years to reach that point. By the fifth year, we got to quit paying the extra FHA insurance premium (required for five years due to the amount of our downpayment). By the sixth year, we knew we were on track to soundly beat our “12 to 15 years” prediction and began to think “10 to 12 years”.

By last year, I guessed we would finish the mortgage by 2020. Several months ago, I wrote “our mortgage will be paid off before the end of this year”.

And when I received the mortgage statement for July’s payment (I received it in May, because we’re more than a month ahead, remember), I saw how low the prinicpal was and went ahead and paid it right then. Then I requested the final pay-off statement, which included a few dollars in closing fees. The day we returned from our recent vacation, I mailed a check for $11.33.

Today, I checked the account online and saw what is shown in the screenshot at top: “PD IN FULL”. It’s done.

At some point, Wells Fargo will send us a check for the amount we still have in escrow, and the whole thing will be over. (Edit: We received that escrow check in July and promptly put it in savings — it will all be needed to pay our next property tax bill.)

Note: This will NOT free up the entire amount of our monthly mortgage payment; some of that each month was for escrow — which paid our property tax and homeowners insurance. Of course, we will still have to make those two payments each year. But the bulk of our mortgage payment can now be added back into our budget — including the extra bits we were paying each month. And, something we won’t really notice until spring, our income tax refunds will seem a lot larger now that we don’t have a mortgage to pour them into.

“The plan?” you might ask. We are now less sure than ever about moving into another house someday. It had always been the idea that this was our “starter home”, but I imagine not having a mortgage payment each month will feel very nice indeed, perhaps nice enough to discourage us from starting another one. It remains to be seen how quickly each month’s extra money will disappear, or whether we’ll be able to save a bunch of it against future needs.

But today, at least for this day, I won’t worry about those future decisions. Today I will celebrate the goal that many Americans never reach, and very few reach in such a short time period.