Early Mortgage Payoff

A study done in 2006 showed that forty percent of households made the wrong choice when they paid off their mortgage early and so missed a better financial decision.  It is true that some loans will charge you a penalty if you pay off your mortgage to early and this amount can come from paying too much during a single year.

Then there are those who will penalize you for just one dollar over your noted amount so before you start adding just that little bit to your mortgage payment, read your contract to be sure you are not hurting yourself. 

If you have credit debt, that is certainly a better choice to pay toward as it is generally more costly than your mortgage in terms of the interest rate. It seems only obvious that paying toward a higher interest rate is the smarter choice.  You could also loose your tax benefit and be then put in a higher tax bracket if your mortgage has more than fifteen years on it. Ask your tax preparer for more details on this to be sure that paying off your mortgage is the right thing to do.