With these changes and the All in One Account I will be changing the way we track our progress. I am just going to worry about our total debt and I will start to track our net worth as well. Our goal is to have our balance decrease $5,000 a month. There will be fluctuations due to the banking changes but we are hoping to stay on track. The current balance is $181,276.30 which means we have paid off 43% of our mortgage in 2 years. We are definitely on track. We have also talked about selling our other condo when the tenants leave. That should virtually guarantee the goal is achieved and we will be debt free by July 2013.

We have saved a projected interest amount of $286,596.74. Our current net worth is TBA.

Saving money by changing lenders was a perk, but not the reason we chose to move our mortgage to National Bank.  National Bank has an All in One Product that we felt would better suit our needs and save us some interest costs.  I rarely recommend products on my blog, but this one impressed us so much that I believe it is worth mentioning.

In the next couple of weeks I will show you how we intend on saving money using this product and how you may be able to as well.  Due to the structure of the account I am also going to have to change the way I track our Mortgage Pay Off Progress.  I am bouncing a couple of things around, but I have not decided exactly how I will track this.  I may add a line for Net Worth to the mix.  I have updated it to reflect the new mortgage amount and interest paid.  To properly reflect the cost of the switch I have included the penalty and the legal fees into the interest costs.  These number will change quite a bit by June or July when we consolidate some accounts and no longer have money idly sitting around.

Original Balance:  $316,000.00 (Jul 2008)

Current Balance:  $238,836.86 (May 2010)

Total Payments:  $108,907.77

Total Interest:  $31,137.38

Projected Interest Saved:  $270K +

There are some changed coming in the next couple of months with the way we handle and track our debt and net worth. We are moving our mortgage to National Bank to take advantage of their All in One product. Although we are still focused on paying down our mortgage I also want to tie that in to our net worth. We are still planning for the future and there may be an opportunity to take advantage of the RRSP rules in the future. We are also going to cash dam our rental properties. There will be more on that in the future, but basically it will turn no tax deductible debt into tax deductible debt which is advantageous.

I have learned some things and saved some money in the process of refinancing our mortgage. I will pass these tips on to you in the next few weeks. Our new way of banking should speed up our debt reduction plans.

We passed the $100,000 mark for mortgage payments this month. We have been making payments for 20 months making our average monthly payment $5331.34. The other accomplishment was having paid off 25% of our mortgage. We have actually paid off 26% this month. I am quite happy with both accomplishments and hope we are fortunate enough to be able to keep it up.

I will have have a hefty tax bill on April 30th and we may be taking a tropical vacation as well. We will have no issues paying for these but our mortgage prepayment may not be the full $4,712 for the month. I am hoping I can pick up some business or some overtime at work to help with the shortfall.

Our projected interest savings are now $270,774.30

I am going to call the bank and ensure that all the money was put against our mortgage and see if they can figure out how that happened.  Although everyone makes mistakes I do not see how I would put $12,500 instead of $500 and I can’t see how the bank would either.  After we get stuff figured out we are likely just going to leave things as is.  The difference in the interest rates between the line of credit and our mortgage is minimul so the difference in the interest over the 3 months it will take to get the line of credit paid off is about $5 as compared to the mortgage. If the bank finds that they made an error and we find out that we have suffered any loss by going into overdraft I am confident that they will compensate us.

There is a big change in our interest saved this month.  I was playing with our mortgage numbers the other day and noticed that I had made an error when we first took our mortgage.  Before the first payment was even made we switched to accelerated bi-weekly payments rather than monthly.  I neglected to calculate the interest savings that we experienced when we switched to the accellerated bi-weekly payments.  Putting this into the equation I am extremely happy to say that we have saved $276K in interest costs combining the bi-weekly payments and our monthly extra mortgage payments.  This month’s bank error certainly helped.  That number simply astounds me.  We had an immediate savings of $97,552.90 when we switched to accelerated bi-weekly payments and it reduced our amortization period to 32 years.  Our additional prepayments have done the rest.

If you have not looked at what a couple of hundred extra dollars a month will save you over the life of your mortgage, you really should.

We did pass a couple of milestones due to the bank error.  Since we started our mortgage 19 months ago we have paid a total of $108,606.22.  We have also paid our original mortgage balance down by 27%.   Now we will be paying down the line of credit for three months.
After we got our error sorted out we decided no to utilize our line of credit to bring our mortgage balance down.  Our prepayments this month totaled $2000.  That combined with the additional $778 last month were are $1934 behind in our prepayment YTD.  We will see what we can do about that in the months to come.  The milestones we had reach have been reversed and we will have to wait a couple of months before reaching them.

Febuary, March and April may be tight months and I an not anticipating being able to make extra mortgage payments.  I do want to hold off as we have a big bill coming in March, a vacation to pay for and I am anticipating a fairly hefty tax bill.  Such is life!

2009 is pretty much behind us now and we can reflect on the past 12 months. Looking back I am impressed with the goal we have set to pay off our $316,000 mortgage in 5 years but wonder if we will be able to make it happen. Shoot for the stars and if you hit the moon you have still done very well.

Our additional payment in December was limited to $2,800. Although this is short of our $4,700 monthly goal it does bring our mortgage balance under $250K which is quite the accomplishment considering that we started at $316K in August 2008.

In 2009 we made a total of $71,675.86 in mortgage payments. There were bi-weekly payments of $760.61 totaling $19,775.86 and additional mortgage payments of $51,900.00. In 17 months of payments we have brought our original mortgage balance down 21%. If we compare this to our original amortization period of 40 years we have a projected savings of $150K in interest and a new amortization period of 21.4 years if we do not make any more additional payments. I am very impressed with our progress.

I look forward to 2010 although I know we will have challenges meeting our monthly goal of an additional $4,700 put down against the mortgage. There are areas in our financial lives that can be improved. We should be able to save some money by reducing our restaurant meals. I also be car pooling to and from work for a majority of 2010 and that should save me $100 a month.

We look forward to sharing our progress with you in 2010.

This leads us into December and we are not expecting to make our goal of a $4700 mortgage prepayment. We have a higher than normal credit card bill as we rewarded ourselves last month with a new couch. A trip to Regina to visit my parents has also been factored into next month. The only goal for December is to go into the New Year with a mortgage balance under $250K. With a $2800 prepayment we will be able to get this done.

With a balance of approximately $253,500 we have been able to pay off 20% of our mortgage. If we were to stop making our prepayments we would have a remaining amortization of 21.8 years and have a projected savings of $146K.

We are still on pace to pay off our mortgage in 5 years and only pay $43K in interest. I am interested to look at our 2009 gross income and see what percentage we had dedicated to the mortgage and total housing costs.

October is coming to an end and we were able to make a prepayment of $4200 on our mortgage for the month. We have missed the mark of $4700 and not made up any of the shortfall in September. This leaves us with a prepayment short fall of $2700 year to date.

A big expense got in the way this month, but was worth it. The desktop computer we were using was 4 years old and it was time for a new one. With the government allowing a Capital Cost Allowance of 100% this year on computers for businesses the purchase just made sense. It will be a good deduction for my taxes.

I will be receiving some business income in November and we are hoping we can play catch up a bit. Putting down $6000 may be achievable. Looking ahead to Christmas and tax time there will be some expenses that may not allow for us to prepay the full $4700 monthly. C’est la vie!

The mortgage balance at the end of October is a little over $258,000. We have now paid off 18.5% of our original balance. Not too bad, considering we have only been making payments for 15 months.

Business has slowed down and I am not yet expecting any business income in October. It may be tight finding the $4700 next month especially because I want to make up the $2200 missed this month. Hopefully I can generate some business income in the meantime to help out.

The mortgage balance at the end of September is a little under $263,000. Compared to our original mortgage amortization of 40 years we are now down to 23 years and have saved just under $130,000 in interest.

To wrap up, we have now paid off 17% of our original balance and are basically on track to meet our goal.