since the mortgage is tax deductible within limits and in a tough environment cash is king I would not pay it off all together, but I would make a status what is there and what you want with your life, retirement etc

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I would pay off the house--it's wonderful to be debt free. This will mean more of your income is available for savings or a more comfortable lifestyle, family vacations, etc.

Steve, there are a few things you should think about before paying off the house. First of all, what is your interest rate on the property? If it is high then you may want to consider looking to refinance it. Many people are not able to do this now due to the loss of equity in their home, but you have the ability to pay it down to the point where you can refinance at a low rate, if this is an issue for you.

The big problem that I see with paying off the mortgage is that you are currently comfortable making the payment and if you pay it off you need to ask yourself if you are going to be able to save those funds. A little forced savings can be a good thing for you, even better than a tax deduction.

What year are you in your mortgage?
Are you in a fixed mortgage?
What interest rate are you looking at?

I would refinance your home using some of the money to deal with the closing costs and pay what ever amount needed to get a FIXED INTEREST mortgage and the length of the mortgage should equate as closely as possible to your retirement date...and I would invest the rest in a no-load mutual

Hey Steve I am an investor in Miami Beach. I would advise you to pay off any big liabilities you currently hold. However this is not where my expertise is. After you do this I would (if you are planning on a family further down the road) open either an IRA or regular investment account so you can make this money work for you and in turn create more income from it.
If interested just reply...

Sorry I didn't reply sooner. I subscribed to the thread, but didn't get any emails saying there were replies!

Anyway.... Looks like I need to supply more info. Lets see...

We're about 5 years into a 30 yr fixed Mort. Housing was going up and up and up, so we chose an interest only mortgage. May have been a bad choice, but we did it. Interest rate is pretty low, although right now I don't recall exactly what it is. We later took a line of Credit. That interest rate fluctuates, but so far we haven't been stung. There isn't any kind of balloon payment or anything on it. It's tied to prime. Between the 1st and the credit line, we had a really nice equity buffer left over. However, we all know what happened. I guess the house is worth just about what I owe at this point.

We're in our 50s', Oldest just graduated college, youngest is still a junior in college.

I think what I'm going to do is gather all the mortgage info together, and last years' tax return, and sit down with a CPA. The revolving credit card payments, and car payment are gone. Just want him to crunch some numbers and tell me paying the Mortgage is a no-brainer, or if I can benefit from keeping the write off.

If you are working with a knowledgable CPA then it all comes down to simple math. If he tells you to keep the house for the tax write off than the CPA is a moron. Let me explain. Let's say you are in the 30% tax bracket, and you make $100,000 and your principle balance on your mortgage is 200K and lets say you are paying $11,215 a year in mortgage interest. If they deduct the entire $11,215 interest from their $100,000 income, their taxable income is $81,670, not $100,000. Note, they deduct the interest off their taxable income, not off their owed taxes. That’s why the savings is not dollar-for-dollar.

The difference between the tax on $100,000 and the tax on $81,670 is about $3000. Therefore you would save $3000 on your taxes, not the entire $11,215 you paid in interest. So, why would you want to send the bank 11,215 only to get back $3000 from the IRS?

I met with a CPA about a week ago. The first thing she said, without knowing me, or anything about me, my status, and my mortgage was "Pay off your mortgage!!" As the meeting went on, I insisted that she crunch my income, taxes and write offs. The numbers said it was a flat trade off. The CPA was red faced. So my decision is whether I'm going to keep the majority of it for investing, or park it in the house hoping the housing market will fly again.

What a jack-ass the CPA was. She didn't charge us, and just made nicey-nicey small talk. She wants us to start coming back on a regular basis. She made a snap call about the mortgage, and couldn't help us with anything else because some computer program wasn't working. I don't think I'm going back there! Good thing the first visit was free.

pay the mortgatge

Remember this, most lenders/CPA's don't have half a brain and if they stopped for a second about what they are recommending and didn't act like a robot, they would be able to service our needs as a customer better.

Save it or pay down the remaining ballance on all your debt and start making your purchases with cash.

Just like your parents told you when you were young, " Save 10% and never spend it will make you a rich man." If I had a dollar for every time I heard that and listend I probably wouldn't be on this forum right now. I'd be sippin margaritas on the beach in Mexico.

Not very many people get that kinda of money. Be responsable. Use common sense and save it. Don't go out and buy that new Mercedes you have allways wanted.