I understand that concept of keeping money liquid, but paying $3900 a year to do so just doesn’t make since. If you could invest that money into a higher yield investment Ok, but why make a point about losing money. Also why would you pay $3900 annually just to continue to owe the 400K. If you are paying principal of that 400K it would be more like -$7000 annually for 30 years. All this wasted money just to keep money liquid. Like SDR said you could just simply open a HELOC and not draw the money and just pay the annual fee. There are also mortgage insurance programs in case of job loss or illness that are a lot cheaper. Why does everyone want to prolong paying off a home. Owning a home outright comes with many rewards. You could sell it and keep all the proceeds. You could rent it out for income. You could live rent free (minus tax, insurance, maintanence, etc). With all the money you save from not paying mortages you could invest. If it wasn’t for the fact that my home is almost paid off and actually cheaper monthly then renting, I wouldn’t have any money to invest. Owning a home and having it almost paid off allows me to save money for a down payment on a move-up home. When I decied to pull the trigger, I could sell my home and put the proceeds into the new home or just rent it out for extra income. I don’t feel like my money is in some kind of equity trap, to me I feel that my equity allows me to do things that I couldn’t do with my (very)limited income.
