Comments on: Why Early Mortgage Repayment Makes Sense for High-income Investors

By: MJ

MJ — Fri, 09 Dec 2016 17:44:41 +0000

I think that an unmentioned but other potential benefit of having the primary residence mortgage free (while continuing/own to fund all the other investment vehicles, including perhaps income producing real estate (rentals) is the opportunity to use a reverse mortgage (the new kind!) for extra living expenses cash down the line. Assuming that there is a bunch of other $$ for lifetime income and a bunch more stashed away for the kids to inherit, pulling money out of a fully paid-off (and hopefully appreciated) asset might also make good sense?

By: Steve

Steve — Mon, 11 Aug 2014 19:30:09 +0000

In reply to Brian.

If you still get the mortgage deduction and you’re not paying an investment advisory fee, I think the prepayment option is overrated… especially with historically low rates. So we might agree here.

What I’m really commenting on is situation I see more and more where people have significant assets outside of tax-deferred accounts, some of that money is in bonds, and then because income is well over the phase out levels, much or all of the itemized deductions are lost.

By: Brian

Brian — Fri, 08 Aug 2014 16:18:28 +0000

More likely scenario:

You make 250-300k, live in a high tax state (CA, NY, etc) and are getting hammered by the AMT (taking away all your deductions *except* the mortgage deduction)…in that income range the mort deduction becomes more valuable.