Paying off the mortgage early is a hot topic when it comes to money management. There seems to be a good amount of quality logic for keeping it and equally valid logic for paying it off early. So what’s a homeowner to do?
After we bought our first house, I began to look into this issue. I read many opinions and ended up agreeing with the major arguments for NOT paying off the mortgage early. These points seemed solid to me. The logic goes like this:
“You have such a low interest rate.”
“You could invest instead and get a better rate of return on your money than putting into extra mortgage payments.”
“More of your money is tied up in your house and you can’t get to it for a big emergency.”
“You are getting tax breaks for carrying a mortgage.”
“A mortgage is a hedge (protection) against inflation, especially with a fixed rate mortgage.”
Then during 2010, my wife and I went through some life changes. We began to rethink many money related things including our mortgage. After a lot of back and forth, we decided to pay off the mortgage early. The reasons may surprise you because only one of them is based on a mathematical concept or equation.