Early Mortgage Payoff

Should I payoff my mortgage early? By all means. Won't that eliminate my tax advantages? Not enough to matter compared to the savings paid on interest and piece of mind. If you have a 30-year fixed-rate mortgage and you have been making payments on that mortgage for more than 10 years, then you aren't getting as big a tax advantage as you received the first few years of paying on that mortgage. Why is that? Because the amount of interest you pay each month is greater when a loan is new. Then as the years go by, you are paying more and more principle each month and less and less interest each month. So by paying off your mortgage early you are not hurting yourself tax-wise. Tip: Be sure to specify the extra dollars be put toward principle. If you do not say this, then interest will be paid first, and the rest put toward principle.

Want an even smarter idea? Pay extra principle as often as possible in the early years of a loan. Then you will pay less interest. And as I said previously, you pay more interest in the early years. So by shaving years off a loan, you also shave off interest. Most experts recommend making at least an extra mortgage payment each year. If you do this you will save thousands of dollars over the life of the loan. I am not an attorney or an accountant, seek the advise of the right expert for your specific situation.