When people say they buy a house, it usually means that they have borrowed the money for the house from a bank. They pay the bank a fee, called ’interest’ every month so they can continue to use that money to pay for the house while they are living in it.
Grandpa Nelson and I have done this three times before. In 1975 we bought a little California bungalow for $32,000. It had been built in the 1920s and needed a lot of care. The three years we lived there, the value of the house soared to $50,000. We sold the house, paid the bank what we still owed, and moved on.
Eugene was the perfect spot for us to start a family, and our California home’s sale allowed us to buy a nice place with a big yard. Like before, we borrowed money from the bank. Your Daddy David and Auntie Katie spent the first months of their lives there. When the business Grandpa Nelson worked for went out of business, we had to give the house back to the bank and move to Salinas.
Once I started teaching, we were able to buy a home in Salinas. Another loan, more interest. We lived there for 28 years! We raised our kids and welcomed our grandkids. It was a good house, but we only paid it off when we sold it.
When I retired from teaching, we had the option of living anywhere we wanted.
This was a new, sort of scary idea, but after researching many cities, we decided on Portland, Oregon. We sold our Salinas home, packed up the stuff and the cat, got another loan from another bank, and bought a nice, modern condominium.
And today, we finally put that cycle of buying and owing and paying interest to an end! We gave the bank all the money we owed and we don’t have to pay any more. It feels good!
And, since we aren’t paying that money to the bank every month, we can do something else with it.