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Pros and cons to paying off a mortgage

Last post Tue, Apr 15 2014 5:31 PM by gloomydog. 31 replies.
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  • Sat, Dec 5 2009 1:18 PM

    • Kim_Mango
    • Not Ranked
    • Joined on Fri, Oct 2 2009
    • Wilmington, NC
    • Posts 19

    Pros and cons to paying off a mortgage

    I recently got into a discussion with a friend about carrying a mortgage.  I recently sold my house and I'm now renting for a little while. 

    Ideally I want to buy a house in cash with no mortgage.  Or buy a house and pay off the mortgage quickly so that I don't have to drag around a 15 or 30 year mortgage on my shoulders.  I will buy a small home our townhouse in the near future.  And, if all I have to pay for is insurance and taxes, what a relief.  No debt and a home.  What could be better?

    My friend argues that the tax write-off is worth keeping the mortgage.  My accountant says that pouring all my money into the house when the money could be getting a better gain in the stock market simply doesn't make sense.

    I'd really like to hear your opinion on the matter in addition to the poll I just posted. 

    Is it simply a personal preference?


    Do you have a goal to pay off your mortgage?


    • Yes (75%)
    • No (25%)
    • Total Votes: 24
    All my best,
  • Sat, Dec 5 2009 2:28 PM In reply to

    • Toni B.
    • Top 25 Contributor
    • Joined on Sat, Apr 5 2008
    • Seneca Falls NY
    • Posts 3,826

    Re: Pros and cons to paying off a mortgage

    Hi Kim. My DH & I are on the fast track to paying off our mortgage. Conventional wisdom used to be that holding a mortgage was worth the tax write off. However things are different now. Just ask how many people lost their homes and stocks last year. Many people refinanced and carried 2nd mortgages to pay off credit cards only to rack up more debt. The key is not buying more house than you can afford and being in an area where taxes are reasonable. Check out the "GASP" thread and see how many "experts" were talking people into doing things they should not have done. If your home is paid off, the bank can't take it away from you. The stock market is a good place to make money IF you: ...1) Have a solid budget where all your basic needs are met .. 2) You have set money aside for emergencies ...3) You're Not prone to overspending ...4) You're willing to Invest in solid companies and be patient.
    Officially Recognized Stretchpert in Stages of Life
  • Sat, Dec 5 2009 2:40 PM In reply to

    • MarthaMFI
    • Top 10 Contributor
    • Joined on Wed, Apr 16 2008
    • New Westminster, BC, Canada
    • Posts 10,850

    Re: Pros and cons to paying off a mortgage

    Here in Canada you can't write off mortage interest on personal tax returns. only under certain situations so the majority of people can't.  

    rather have no debts then the little bit of tax return you would get.  peace of mind!

    Officially recognized Stretchpert in Hobbies and Crafts
  • Sat, Dec 5 2009 4:41 PM In reply to

    • gayla50
    • Top 10 Contributor
    • Joined on Mon, Sep 24 2007
    • Western North Carolina
    • Posts 8,491

    Re: Pros and cons to paying off a mortgage

    we paid of the mortage 30 years ago  wiht my house money and what DH had paid for the house for 8 months after we married we deposted the payment every month we use it to cover repair to the household and taxes


    Officially Recognized Stretchpert in Frugal Food and Cooking and in Slow Cooker Foods

    Purpose is what gives life a meaning
  • Sat, Dec 5 2009 4:44 PM In reply to

    Re: Pros and cons to paying off a mortgage

    We must also remember that the tax deduction is ONLY for the interest we pay on the loan. If we are lucky to have a low-interest loan on a not-too-big mortgage, then the tax write-off is even less necessary.



  • Sat, Dec 5 2009 7:06 PM In reply to

    Re: Pros and cons to paying off a mortgage

    I would rather pay a mortgage than rent... but I'd rather not pay either!  My goal is to pay off my mortgage before I retire, in 12-13 years (at the outside, for paying off the mortgage - I may not retire that relatively soon).  Once I pay off the mortgage, my need for retirement income will drop way down, a significant hedge against inflation and less retirement income than I am currently expecting.
  • Sat, Dec 5 2009 7:32 PM In reply to

    • Pat
    • Top 10 Contributor
    • Joined on Tue, Mar 6 2007
    • Colorado
    • Posts 14,463

    Re: Pros and cons to paying off a mortgage

    How much does it cost to get that tax write off? The average home winds up costing about three times the price after all the mortgage interest is added in. Do you get that much in tax written off?

    I haven't had a mortgage in about 10 years. If I lost my income tomorrow, worrying about a place to live would be the last thing on my list.

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  • Sat, Dec 5 2009 7:44 PM In reply to

    Re: Pros and cons to paying off a mortgage

    I would rethink a townhome I live in one now and just hate it not so much the townhouse but there is very,very little yard in the front and the back is more like a cliff.  I myself would much rather have a single family home and also 3 of the ladies that live here feel the same way as I do and they all own theirs.  When you are used to a single family home and a yard a townhome just doesn't work for me.

  • Sun, Dec 6 2009 1:02 AM In reply to

    • Nancy B.
    • Top 500 Contributor
    • Joined on Fri, Nov 20 2009
    • MD...soon...FL.
    • Posts 26

    Re: Pros and cons to paying off a mortgage

    Hi Kim......1st congradulations on selling your house. 2nd pouring ALL your $ into any ONE thing doesn't seem like a good idear. No debt and a home sounds great if you can achieve it and still have $ in the bank  to cover the unexpected. Good Luck  finding a house in your financial comfort zone that you LIKE in a location that you LOVE. 

  • Sun, Dec 6 2009 2:36 AM In reply to

    Re: Pros and cons to paying off a mortgage

     The write off isn't the dream they make it sound like it is.  If you can pay it off, do so and be free!

    You teach people how to treat you -- Dr Phil
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