Paying Off Your Florida Mortgage: Don’t Always Be In Such a Hurry

We understand how badly you wish to be financially free. Many homeowners use aggressive tactics to pay off their Florida mortgage - such as having a 15-year term on their fixed-rate mortgage or a bi-weekly mortgage.

However, be aware that some home loans carry pre-payment penalties that can end up costing you more. Also be aware of this: While paying off your mortgage is a worthwhile goal, it may not necessarily be the best use of your money, depending on circumstances.

When NOT to pay off your Florida home mortgage

If your employer offers a match to your 401k, then it might be a smarter use of your money to put more toward that account. These are pre-tax dollars that will be saved for you when you retire, helping to ensure fiscal stability down the line.

Here’s another scenario: You may have lots of high-interest credit card debt. Pare this down before worrying about Florida mortgage loan payments. How come? Because this could have a positive effect on your credit and lead to a lower interest rate if you need to consider a Florida home loan refinance for any reason later on or apply another loan for on a car, for example.

Moreover, the interest rate on your credit card may be as high as 15, 20, or even 30 percent; whereas the interest on your mortgage is probably around seven percent or less. Interest on your mortgage is also tax-deductible. Interest on your credit card is not. Better to pay off your credit card debt with non-tax-deductible interest first.

Other higher-return investments, or even saving money for things like your children’s college tuition, may be better uses for your money than paying down your mortgage immediately. Of course, it’s your money and your decision. But we recommend completing the cost-free form on our site and speaking with a Florida home mortgage broker to learn more.