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I ran the numbers - Barn renovation loan

October 7th, 2015 at 09:01 am

Regarding my post yesterday - I ran the numbers on a relatively small loan from the bank, and not paying my aunt's loan off right away versus maxing out the loan from the bank, and paying my aunt off right away.

The difference is $1,210 more paid in interest over 5 years. Or $242 per year. Or $7.95 per month.

To be clear - my aunt is not badgering me for the money. She is not rolling her eyes when we go on a vacation, or buy something for the kids. In fact, she was absolutely thrilled when we borrowed money from her to renovate our family's farm house.

But, my heart tells me that we shouldn't be beholden to her. Now that we have a way to pay her back, we should. It's the right thing to do.

When we borrowed the money from her, our options were limited. Conventional borrowing from a bank was not an option. In fact, I let her know that we would pay back the money as soon as we were able. We will soon be able to pay the money back.

DW and I will discuss. I've made up a handy-dandy color coded spread sheet (DW is a visual person) that outlines each of the options.

More on this later.

3 Responses to “I ran the numbers - Barn renovation loan”

  1. Jenn Says:

    I think your plan to prioritize repaying family is the right thing to do. The relationship and your commitment is more important than saving money in interest. She helped you because you were in a bind, and you're not in that bind any longer. Good luck with the barn!

  2. Bluebird Says:

    If I were in your shoes, I would pay my aunt back, too! Great job on getting it all figured out!

  3. PatientSaver Says:

    Yes, i agree with everyone, you should pay her back. Because if you delay paying her back now for a time when it may be more "convenient," chances are you'll keep sliding on paying off her loan and it will become an issue. Even if she hasn't said anything to you, she may be hoping you'll pay her back and is too nice to say it.

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