My husband and I are debt free except for our mortgage. We recently refinaced $132000 for ten years at 3%.
I would like some opinions...Do you think it is worth paying off this mortgage at such a low rate before it's term? In the past we always paid extra on the principal every month but now I am not sure what to do!
The answer depends on your plans.
Do you plan to live in the house longer than 10 years, or is this not "the house" you want to keep? If you are not going to be in the house for another 10 years, then paying extra on the mortgage is betting that the housing market will improve, which I personally believe is a gamble.
If this this the home where you intend to live & grow old together, then by all means pay extra on the mortgage & get it paid off ASAP, as long as you can still save for retirement, etc.
Owning your home early will save you a lot of money not paid on interest on the loan, over the 10 years. You will pay around $40,000 for the priviledge of paying it off over 10 years.
We will own our home, & be debt free, by the end of the year. We do not view our house as an investment, we view it as our home, the shelter over our heads, & the land that feeds us through our garden, fruit tree, & berry bushes. To us, the only downside of owning our home was that we lose a tax deduction of around $900/year that we pay in mortgage interest. I do not expect that the mortgage deduction will survive the next round of government cuts, anyway.