Becoming debt free is as much a part of the American Dream as owning a home but there certainly can be conflicting circumstances that make the decision to pay off your mortgage early unclear.
Whether you pay off your mortgage early is a personal decision that may be right for one person and not for another. Consider the following before you get started:
Reasons you should
- Peace of mind knowing that you don’t have a mortgage
- You’ll save interest regardless of how low your mortgage rate is
- Lowering your housing costs before you retire
Reasons you shouldn’t
- You can invest at a higher rate than your mortgage
- You have other debt at a higher rate than your mortgage that needs to be paid off
- You might need the money in the future and want to remain liquid
- You might not qualify for a mortgage currently
- You should pay off other debt with higher interest rates
- Your employer has a matching retirement plan that would benefit you more
- You have more urgent financial needs like emergency fund, life, health and disability insurance
- You expect high inflation and the value of your mortgage debt will decrease
Use this Mortgage Accelerator to determine how quick you can pay off your mortgage.