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Old 08-11-2011, 01:48 PM   #61
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I might go into mourning. The end of a low interest, tax deductible loan! The loss of some liquidity!

Just a different viewpoint. -ERD50
Back when I had a house in the Megacity I paid off my 15 year note in year 12. I quit doing the Schedule A a few years before that because I just didn't have enough deductions.

On a side note - back in the days when this was doable - I had a friend whose husband refinanced their house every few years and maxed out the loan amount. She defended him by saying it was OK to have that kind of "good" debt because they got to deduct all of the interest on their income tax. <sigh> Their mortgage payment got significantly higher each time because the house appreciated nicely. But, by golly, they had fancy new cars every year, very expensive nice vacations, lots of jewelry, and the young 'uns always had the latest whatever because they were spending all of the getting the "equity" out of their house at each refi.

When I paid off my house they were enjoying higher mortgage payments and a 30 year note.
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Old 08-11-2011, 01:59 PM   #62
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One point I don't think anyone made so far is the value of the tax deduction. We had come to the point where only a portion of the mortgage interest we paid annually was putting us over the standard deduction amount. So, much of the interest we were paying had no tax benefit.

So I paid it off last year before ER. It's good to have no debt!
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Old 08-11-2011, 03:02 PM   #63
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Something to think about if you are self-employed - the interest tax deduction is even more valuable as it reduces your SE tax as well as your Federal and State taxes. We're self-employed, with 33% of our home dedicated to office/studio space. With the home office deduction, we can take 33% of our mortgage interest paid for that tax year and reduce our self-employment income. (As it is, our SE tax is horrendous. Even at 13.3% for 2011, it will be more than our Federal and State combined, and we're in the 25% bracket. That's because the SE tax is calculated on your net business profit, before retirement contributions and personal exemptions are taken into account.)

When we sold our house in CA we had enough to buy another house outright. Instead we invested the same amount of money and it's kicking off 7%, which pays both the mortgage and property taxes and then some. The mortgage is 4.65% (about 3.5% after the deduction). I'd love to pay off the mortgage and be completely debt free, but any time we run the numbers we can't think of a good reason to. Liquidity is even more valuable when you're self-employed too.
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Old 08-11-2011, 03:42 PM   #64
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We weren't able to deduct interest for the whole time we had our home loan, unfortunately, so there was no "benefit" to paying the interest.

Daydreamer, I love your list! We used to keep our budget on our refrigerator, plus a graph showing our debt decline, for all the world to see. It takes a pretty bold friend to question my judgment on most things, but about money? Most don't want the 'schooling' that might result.
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Old 08-11-2011, 05:15 PM   #65
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

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Old 08-11-2011, 05:22 PM   #66
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Let me be the 1st to congratulate you!


Feels good, doesn't it?
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Old 08-11-2011, 05:22 PM   #67
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.
Wow! Great feeling, eh?
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Old 08-11-2011, 05:25 PM   #68
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I tell people I'm still making mortgage payments (only they don't have to know that they are to myself, the Bank of Nui).

There's a French Canadian custom of putting 3 butterflies on the outside of your house once the mortgage is paid (to symbolise freedom). Whenever I see them, I smile :-)
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Old 08-11-2011, 05:26 PM   #69
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Neat custom.
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Old 08-11-2011, 05:33 PM   #70
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I tell people I'm still making mortgage payments (only they don't have to know that they are to myself, the Bank of Nui).

There's a French Canadian custom of putting 3 butterflies on the outside of your house once the mortgage is paid (to symbolise freedom). Whenever I see them, I smile :-)

How cool! In the past when I've seen that I thought it was dorky and showed a, ahem, less than spectacular design sense. Now I'm tempted to get some for the down south house.
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Old 08-11-2011, 05:40 PM   #71
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Wow, CONGRATULATIONS!!! What a wonderful feeling and accomplishment. Time to celebrate.
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Old 08-11-2011, 05:42 PM   #72
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Congratulations!
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Old 08-11-2011, 05:43 PM   #73
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Woot woot! Congratulations!
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Old 08-11-2011, 05:46 PM   #74
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Wow, time for celebration, congratulations!

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Old 08-11-2011, 06:07 PM   #75
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Thanks, everyone. Just updated the budget spreadsheet and both DH and I are grinning ear to ear. Everyone's situation is different but for us this made so much sense at this point in our lives.
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Old 08-11-2011, 06:49 PM   #76
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Congratulations!.

So, are you telling anybody (besides us)?
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Old 08-11-2011, 07:12 PM   #77
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Congratulations!.

So, are you telling anybody (besides us)?
Nope--it's our little secret!
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Old 08-11-2011, 07:42 PM   #78
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

congrats!
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Old 08-11-2011, 09:00 PM   #79
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Thanks, everyone. Just updated the budget spreadsheet and both DH and I are grinning ear to ear. Everyone's situation is different but for us this made so much sense at this point in our lives.
Fantastic news, Feever! So happy for you right now! It is really an amazing feeling that will get better when you think about it each month and NOT sending them that money!
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Old 08-11-2011, 09:05 PM   #80
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Ahem--happy to share that we just paid off our mortgage 45 minutes ago.

Good job.
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