Our Mortgage!

Yes, we did not have enough cash to buy our place without borrowing from the bank.  It would have been nice but in todays world it is not a realistic possibility for most people.  We bought our condo for 239,500, we then took out a home equity line for $191,600.  This is the maximum amount that you are allowed to borrow for a HELOC.  The difference of $47,900 was our down payment.  After all of the legal fees, moving costs, and other various expenses we had $17,000 to spare to put directly on the HELOC.

Our current HELOC balance is $174,550.  Now because I work in the banking industry I get some pretty good rates.  Up until JAN 5 2010 my HELOC rate is just 1.75%!  After that it goes up to 2.75%.  The jump in rates is that same jump that the banks put through to consumers a couple of months ago.  That means that up until Christmas my interest only payment will be just $255/month.  After that it will be just $400/month.  We will of course be paying more than this, but if times get rough we can easily cut back on expenses if need be.

I currently only work 15-25 hours a week because I am in school, and my wife is on maternity leave until April.  This means that will we will not pay down our HELOC as fast as we want to, but as soon as we have increased income or any extra cash we will be depositing it directly onto the loan.