[cuz68]

Originally Posted by Supertacks

Bingo . . . its an emotional thing. The idea of owning it free and clear and eliminating
the stress and burden of the mortgage is totally appealing to me. Isn't part of the American Dream to own own our homes. How many of us really achieve it.

Any one here own there homes free and clear. What did it feel like the day you made that last payment.

How much financial freedom do you now have to chase other opportunities that you had to pass on previously because you didn't have the cash.

Right now I do not have the extra money to invest the way I want to. My employer does not offer a match, so I am feeling like my investment strategy is even less effective. If my house was paid off . . . you can bet that 80 percent or more of the money I currently pay on my mortgage would go right back into investments.

I would also like to start my own business. I cant get past the risk of a potential income hit during start up, so its not even a realistic consideration for me. No mortage eliminates that.

If I wanted to make a career change I could do that knowing my income would suffer a bit. Not possible with my mortgage.

Also

If something happened to me. My wife would not have to worry about the house.

I know on paper it won't calc out. But I am least going to go through the analysis. If its close, it really could get some consideration.

Did you read my post where i paid my home off? I am very happy and feel very good about it, NO more payments means a lot too me, Good luck on what ever way you go. Click on my gto and you can find my thread.

[kenneth77]

why do you have to pay a interst rate of 5,35%,when the federal reserve have lowered the rate to 3%(?) ..i thought the normal was +1% from the banks

[Supertacks]

Originally Posted by kenneth77

why do you have to pay a interst rate of 5,35%,when the federal reserve have lowered the rate to 3%(?) ..i thought the normal was +1% from the banks

Fixed rate mortage at 5.35.

I am going to talk to my money guy today. My guess is I won't end up doing this. But it certainly sounds good on the surface.

[OhMyGoat]

Although 98k minus 45k sounds good, the equation is missing the growth potential that the retirement investments will bring over time.

A 5.35% mortgage is a bargain. I spent a lot of years paying off my mortgage that was 9.75% and we made it through. Be patient. For a regular family (not independently wealthy) a home usually takes years to pay off. I would never draw down an IRA or 401k to pay down a mortgage. Nor would I borrow against them.

[PonchoV8]

I paid my first house off and it felt great. I'm watching a friend try to keep up with the Jones' and is buried so deeply in debt, it scares me. You get used to it seems--and then again you don't.
We ended up taking an equity loan to buy a second house to remodel. When it got down to a certain level, I surfed it to a credit card with a lower interest.

Our current house is the one that's 16 yrs out in a conservatively aggressive pay off schedule. We could liquidate some stuff if needed and get back to zero (assuming those things still have value). It's a risk I'm taking, and feel very much like you feel right now about.

[1967Clone]

Originally Posted by OhMyGoat

Although 98k minus 45k sounds good, the equation is missing the growth potential that the retirement investments will bring over time.

Yes BUT his mortgage payment could then be used to replace the "lost" investments. That's what I've done and it's worked out GREAT.

[GTOGreg]

I think he was referring to the penalties and the growth opportunity those would bring over time.

[Supertacks]

So I have decided against this route.

In short I own a property at the beach. I bought it as a fixer upper 4 years ago with the idea that it would take 5 years to get it where I want it. So far I am right on schedule.

Although it is close to being done . . . I could not sell it "as is" and pull the sweat equity out of it.


What I decided to do is take out a small loan and hire someone else to finish it over the next three months.

That way if I need to move it quick, I can flip it and be done with it.

I do appreciate all the feedback however!

[PonchoV8]

Originally Posted by kenneth77

why do you have to pay a interst rate of 5,35%,when the federal reserve have lowered the rate to 3%(?) ..i thought the normal was +1% from the banks

That's the rate that they loan banks to banks. I can't answer why mortgage rates aren't tied directly to that rate though. I just know they aren't.

[UPC-WU2]

I just did it. I had two IRAs, one through work that I can't touch and another independent one. Lately they had been bleeding 2 grand per week. I cashed one out and paid down my mortgage. Sure I took a 10% penalty. And I'll have to pay taxes on it but I would have been taxed on that at some time anyway. Now I'm in much better shape in my opinion. Owning your house is huge.

Why, when someone asks for advice for ways to get more financially sound, do people tell them to 'borrow more'?

[UPC-WU2]

Now if you wanted to cash out an IRA and take a trip, or buy a boat or home theater, then I'd suggest not doing it. But paying off a house? yes. Maybe it's just me, but I don't like debt.