I guess I would be included to get the mortgate. Here's why (in no particular order):You said you wanted to save for college for your young kids, that means you have a long investment horizon. We don't know what the stock market will do in that time, but its almost certain to be better than the cost of your mortgage.Money is cheap right now. We always hear about the geniuses who loaded up on 14% bonds in the 1980s. I think in 10 or 15 years we'll be hearing about the geniuses who borrowed lots of money at 5 or 6% at the turn of the century. Diversification. People would never recommend you put all your money in one stock, but they will recommend you put all your money in one house. I think its only prudent not to have any one assett be outsized. Opportunity Cost. Often overlooked but it is a real cost. You don't know what the future holds. Being able to take advantage of future opportunities is valuable. Time value of money. When you kids go to college your mortage payment will be so small it will be laughable. It won't be significant. If you buy your house outright, you are using expensive dollars now to save cheap dollars later. Worth keeping in mind.
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