If you had the money to pay off your mortgage after agressively paying it down.......

[redgtxdi]

Obviously the precedent is set that I'm more the "pay it off" type than the "mortgage interest is a good thing" kinda' guy.

Any opinions?? (Debt-free otherwise, so no worries on cars, loans or anything else)


(Pollage maybe?)

EDIT: Poll added!!

 

[radioouman]

Because of the amount of money that is spent as interest over the length of a 30 year loan, paying it off early is a great financial move. However, you need to be able to maintain an emergency fund in your savings account that is equal to or greater than 6 months of income. Once you have this, then pay off that loan!

 

[Adul]

Be better to pay off other debts you have instead of the mortgage as that lowers your taxable income. But if there is a target monthly payment you wish to get down to, it isn't a bad thing to do.

 

[rivan]

I'd pay it off.

No doubt there will be a bunch of people telling you that stocks are better. I prefer the sure thing, and have been beaten up enough by stocks to be wary of their overall performance.

 

[Blieb]

I'd pay it off and then let the would be mortgage payments re-pay me from that day forward.

That being said ... I wish I was in that situation!

 

[Blieb]

Originally posted by: Adul
Be better to pay off other debts you have instead of the mortgage as that lowers your taxable income. But if there is a target monthly payment you wish to get down to, it isn't a bad thing to do.

I agree that any other debts should be settled ...

I don't think you were outright saying it, but I disagree that payin 300k in interest over the life of a loan ... for a 10k/yr tax credit for 30 years (fraction of 300k) ... makes any sense.

 

[RightIsWrong]

I would pay off any/all debts with a higher interest rate first and then see if there was an investment that I could make that would give me a decent return on the rest while keeping the mortgage to offset any gains.

 

[d33pt]

Originally posted by: Blieb

Originally posted by: Adul
Be better to pay off other debts you have instead of the mortgage as that lowers your taxable income. But if there is a target monthly payment you wish to get down to, it isn't a bad thing to do.

I agree that any other debts should be settled ...

I don't think you were outright saying it, but I disagree that payin 300k in interest over the life of a loan ... for a 10k/yr tax credit for 30 years (fraction of 300k) ... makes any sense.

he's saying that if you have other debts, such as CC debt, that is not tax deductable, then you're better off paying that off first. also, mortgage loan is usually the lowest interest loan.

 

[D1gger]

We don't get to write off mortgage interest against income in Canada, so I definitely try to pay off mortgage as soon as possible (we will be mortgage free again in 30 days).

 

[0roo0roo]

does that mess with ur taxes?

 

[kranky]

I hate debt, so I paid it off as soon as I could.

 

[txrandom]

I let other American's pay for my mortgage.

 

[ObiDon]

Originally posted by: d33pt

Originally posted by: Blieb

Originally posted by: Adul
Be better to pay off other debts you have instead of the mortgage as that lowers your taxable income. But if there is a target monthly payment you wish to get down to, it isn't a bad thing to do.

I agree that any other debts should be settled ...

I don't think you were outright saying it, but I disagree that payin 300k in interest over the life of a loan ... for a 10k/yr tax credit for 30 years (fraction of 300k) ... makes any sense.

he's saying that if you have other debts, such as CC debt, that is not tax deductable, then you're better off paying that off first. also, mortgage loan is usually the lowest interest loan.

yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

 

[kranky]

Originally posted by: ObiDon
yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

Are you channeling 2003? It ain't that way any more.

 

[ObiDon]

Originally posted by: kranky

Originally posted by: ObiDon
yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

Are you channeling 2003? It ain't that way any more.

over the span of 30 years it will be

 

[Linflas]

Originally posted by: kranky

Originally posted by: ObiDon
yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

Are you channeling 2003? It ain't that way any more.

At the moment but 5-10 years out I would bet on appreciation.

 

[neovan]

Originally posted by: Linflas

Originally posted by: kranky

Originally posted by: ObiDon
yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

Are you channeling 2003? It ain't that way any more.

At the moment but 5-10 years out I would bet on appreciation.

If that's the case, then stocks, index funds, mutual funds would be a better idea.

 

[Cuda1447]

Originally posted by: ObiDon

Originally posted by: kranky

Originally posted by: ObiDon
yep. not to mention that the interest you pay on a mortgage loan isn't that big of a deal in the grand scheme of things. unless you live in detroit or some other unfortunate area, the appreciation on your property value will easily outpace the amount of interest you pay over the life of the loan.

Are you channeling 2003? It ain't that way any more.

over the span of 30 years it will be

Someone correct me if I'm wrong but I'm pretty sure Ive read somewhere that the appreciate of a house (over the course of a long time, re: 50+ years) barely outpaces inflation.

 

[JS80]

Why would you want to pay off something that is very low interest and has huge tax advantages?

 

[redgtxdi]

Whew!! Friggin' work getting in the way of my neffing here..........that could be a problem!!!

Anywhoooo.......

*IF* I paid the whole mortgage off this very day, I'd probably have about 3 months worth of emergency 'cuz I have a few K left over + mortgage payment goes out this week so that'll drop the principle another K.

But my delusional way of thinking is that the interest I'm paying now toward the end, is piddly now, so I figure why not ride the rest out on the bank's clock since it was mine the bank rode toward the beginning of the note??

 

[redgtxdi]

Originally posted by: JS80
Why would you want to pay off something that is very low interest and has huge tax advantages?

Exactly what I what I was saying above.........BUT......

While I believe in riding the latter-half-or-the-mortgage train, I don't agree w/ the HUGE tax advantages.

Paying $100 to get $25 back is just great when you don't have a choice, but when you do........it's pretty kick-in-the-balls-stupid.

 

[JS80]

Originally posted by: redgtxdi

Originally posted by: JS80
Why would you want to pay off something that is very low interest and has huge tax advantages?

Exactly what I what I was saying above.........BUT......

While I believe in riding the latter-half-or-the-mortgage train, I don't agree w/ the HUGE tax advantages.

Paying $100 to get $25 back is just great when you don't have a choice, but when you do........it's pretty kick-in-the-balls-stupid.

Get an equity line, buy stocks, write off interest. Double win. (but possibly lose your shirt with your house)

 

[rh71]

If I'm sure I'm staying there for the rest of my life (or 30+ years) then I'm paying it off ASAP. Otherwise I'm paying the minimum every month.

 

[redgtxdi]

Originally posted by: rh71
If I'm sure I'm staying there for the rest of my life (or 30+ years) then I'm paying it off ASAP. Otherwise I'm paying the minimum every month.

Well.......ya, I've pretty much said they can bury me here......

Being that I bought in '95 (brand spankin' new), it ain't a huge house, but it's plenty for me, the wife & kids, plus when they leave I'll get their bedrooms back....... .......but more imprtantly......

CALIFORNIA'S PROP 13!!!!!!!

If I never sell this house, I'll only ever owe the original amount (plus any improvements I make that improve the houses value) in property tax which can be a HUGE advantage here in Cali where common suburbia can mean $300K houses or $1.3M houses only minutes from eachother!!!!!

 

[markgm]

http://forums.anandtech.com/me...id=38&threadid=2177814