It's a dream to be able to pay off your mortgage early, but is there a downside? While it sounds like a great idea, there are some factors to consider before doing so. This article will explore some of the reasons you may want to hold off on that final payoff amount.
If you have various other debts (credit cards, auto loans, etc.) it's a good idea to pay those off before the mortgage. Why? Well, credit cards usually have astronomical interest rates so that outstanding balance will only grow if you choose to put all your money towards your mortgage.
That extra interest on your credit card or auto loan isn't tax deductible, which leads to the next point.
Check for Penalties
Some mortgages come with a prepayment penalty. If you're thinking about paying yours off early, then check the fine print to see if it applies, and also run the numbers to see if early payoff makes sense.
Fund Your Retirement Plan
Before you go paying the mortgage...