Why You Should Pay Off Your Mortgage (If You Can)

The day you pay off your mortgage is an exciting day. So why would you want to put that off? Here are some reasons not to.

Paying off your mortgage is one of the greatest feelings in the world. However, there are some people who put off paying their mortgage off completely for a variety of reasons. Some cite tax benefits of their mortgage while others are afraid to take that much money out of their savings because it is there in case of an emergency. These are good reasons, but paying off your mortgage has many more benefits than keeping it. Here are a few reasons why you should pay off your mortgage if you are in a financial position to do so.

1. More Cash Flow
When you pay off your mortgage, you have more cash in your pocket each month. Mortgage payments are in the hundreds of dollars and some of them are even in the thousands of dollars. If you were able to pay off your mortgage, just imagine putting all those dollars each month back into your bank account or pocket.

2. Overall Cost
Unless you are paying zero percent mortgage rates on your home (which is unheard of), your mortgage is costing you money each month. Of course, you can use your payments as a tax deduction and lower your tax bill each year. But the money you will save in interest by paying off your mortgage as early as possible probably will not equal the amount of savings you get on your annual tax return.

3. Security
Just imagine how secure you would feel knowing that you don’t have to make a house payment each month. When you are making payments, there are always thoughts in the back of your head like “What if I lose my job?” or “What would happen to my family if I died or became disabled?” When you have a paid-off mortgage, that is one less financial worry that you and your family have to worry about.

4. Building Equity
Equity is a great thing. It is the accumulation of payments you have made on your home which is available to you in case of an emergency. When you have your mortgage paid off, you have more equity available to you in case some medical need arises or for whatever reason. Terms are fairly cheap for home equity loans so this gives you one more option if you ever need more credit in the future.

These are just a few of the reasons you should pay off your mortgage if you have the opportunity. You may save some money in the short run by keeping your mortgage, but you could end up paying for it by the time the mortgage terms are over.

Add your Comment

or use your BestCashCow account


Featured - 30 Year Fixed Mortgage Rates 2024

Lender APR Rate (%) Points Fees Monthly
Learn More
Mutual of Omaha Mortgage, Inc.
NMLS ID: 1025894
6.956% 6.875% 0.63 $2,655 $2,103 Learn More
Rocket Mortgage
NMLS ID: 3030
7.451% 7.375% 0.75 $2,400 $2,211 Learn More
NMLS ID: Not a Lender
Learn More
NMLS ID: Not a Lender
Learn More