<p>PDIH, I want to restate what the poster said about getting advice from websites, though I am sure you are taking all of these posts just as suggestions to investigate. Most financial advice is very general, and can be a disaster to you personally if you are in a category where there is something that precludes you from the majority. For example, yes, it does make good sense to pay off a mortgage that is costing you more than what you can earn on your savings. However, once you pay off that mortgage, you no longer have that money and you lose flexibility and leverage. There is no guarantee you can get your hands on that kind of money if you should need or want it. Yes, you can get a HELOC, but as many home owners have discovered these days, they can be shut down in an instant with no warning. If your house loses value, your credit line can be reduced. Since the house is all yours, you take ALL of the risks. Many a family was saved from total financial disaster and bankruptcy during this current economic crisis because they were able to walk away from their house. It also forced the banks and the government to renegotiate mortgage terms. Once the house is all yours, all of those problems are yours.</p>
<p>Credit is so tight and things are so uncertain these days, that I know a lot of people who are borrowing every cent out of their HELOCs at the current very low interest rates and just banking it, paying the interest differential for that flexibility. There is a feeling that interest rates are going to go up in the next year, some say waaaaaay up which means you won’t be able to get those numbers you currently have for your mortgage.</p>
<p>On the other hand, if you want to be debt free and keep things simple, paying off your mortgage makes a lot of sense. Do check what it will do in terms of taxes, college financial aid and other financial positions before you do this.</p>