Paying off your mortgage early sounds like a dream.

But given today’s low interest rates, in certain circumstances paying off your mortgage early isn’t always good idea.

Here are three reasons why some people should not pay off their mortgage early.

With most fixed-rate and variable-rate mortgages below 4.5%, it really doesn’t make much sense to make extra payments towards a low interest rate mortgage when you have high interest rate credit cards, overdrafts or student loans.

If you’re great at saving money, one of the best ways to maintain peace of mind is to take three to five years of mortgage payments and put them in a separate account and directly debit your mortgage payment from it each month.

This provides the security of knowing your payment is set for at least a few years, without typing up your liquid capital. 

If you believe at some point in the near future that you might want to sell your house and downsize, it might be a smart move to hold onto your cash instead of paying off the mortgage.  

First of all, on the odd chance the property market goes south, you’ll have more options (such as a short sale) when you have a mortgage versus owning the property free and clear. 

And, if you’re considering buying a new property, having cash on hand for the deposit is essential.

If some or all of the above points apply to you, then maybe paying off your mortgage isn’t the right move.

We help Irish homeowners get cash injections and reduce their mortgage repayments in 2 simple steps

1 – Pension Consolidation
If you’ve had a pension before, it’s probably still with your old pension provider. When you reclaim your old pension(s) you can take a lump sum cash injection of 25% of the combined pension values.

2 – Lower Interest Rate

Most Irish homeowners are on high interest rates. Recently, the lenders have been undercutting one another to attract new customers. Switching to a better rate often results in saving tens of thousands over the course of your mortgage.

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