Message Font: Serif | Sans-Serif
 
UnThreaded | Threaded | Whole Thread (19) | Ignore Thread Prev | Next
Author: CycleGirl One star, 50 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 19224  
Subject: Re: Poll: Have / Will You Pay off Your Mortgage Date: 11/4/2007 5:07 PM
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Recommendations: 0
iamdb wrote: I voted that I could pay it off but choose not to, but such an open ended question makes little sense.

In our case, we have a 30-year fixed loan at 5.5%, with a loan to value under 20%. Deductablity of the interest reduces the effective rate to less than 5.5%. Our long-term return on investment has well exceeded 5.5%, and our money is in several IRAs. Thus, it makes little sense for us to pay off our house loan even if it might feel good to do so.

But you might well imagine other situations in which paying off a mortgage makes sense. A high interst rate or a variaable rate mortgage come readily to mind, situations where return on investment can be expected to be less than the cost of the loan.

The option you should have provided: It depends on circumstance.


I think that it always depends on the circumstances. Arguments can be made for either choice, but what I was looking for was a simple "What proportion of retired fools have decided to pay-off their mortgage?"

So far, 60% of Fools have answered as you. "I could but choose not to."

At 5.5%, I can well imagine that paying off doesn't make a lot of sense for you. I'm at 6.125% - closer to what I consider the tipping point. After all, where else can I get a zero-risk 6.125% return on my non-IRA money?
Post New | Post Reply | Reply Later | Create Poll . Report this Post | Recommend it!
Print the post  
UnThreaded | Threaded | Whole Thread (19) | Ignore Thread Prev | Next

Announcements

Post of the Day:
TMFDeej's CAPS Blog

Name of the Game: Tax Avoidance
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and "#1 Media Company to Work For" (BusinessInsider 2011)! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement