Paying off your mortgage might sound ambitious, especially if you have recently refinanced into a 30-year term. But it’s still smart for homeowners to give some serious thought as to how they’ll pay off their home loan.
An early mortgage payoff can net substantial interest savings compared to making scheduled payments for 15 or 30 years.
Paying more quickly reduces your housing cost, freeing up that money for other needs and wants, says Ronit Rogoszinski, a wealth adviser at Arch Financial Group in Garden City, N.Y. You’ll still be responsible for property taxes, homeowners insurance, and home maintenance and repairs, but your mortgage payment will disappear.
“Once that money can remain in your pocket, you control that money,” Rogoszinski says. “It’s yours. It’s not going to someone else.”
An argument can be made in favor of allocating more cash to investments instead of eliminating low-cost debt, says Alfred McIntosh, principal of McIntosh Capital Advisors, a financial planning and investment management firm in Los Angeles. But he says being mortgage-free can be “a very beautiful thing,” especially for homeowners near retirement age.
Here are six ways to get rid of your mortgage.