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Thread: Pay off the house or not?

  1. #11
    There some things to verify. SSDI used to be awarded, calculated on your *last* 40 quarters of earnings. So if your current earnings are diminishing, so will your SSDI award if you wait.
    The other is that the date of award is the date you apply even if you are denied and have to appeal. Layers usually won't help until you've been denied.

    I wish I'd done it 20 years ago. My SSDI benefit would have been more than SSI at the time since I quit working at 49. As the years rolled by I watched the potential SSDI benefit zero out.

    5K is not much of a nesteqq, better hold off for now.
    I have had periodic paralysis all my life. I lost my ability to walk in 2011 beginning with a spinal block, which was used for a hip fracture caused by periodic paralysis.

  2. #12
    Senior Member darty's Avatar
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    This is the strategy we have used and our tax advisor has recommended to us. We feel much more comfortable with a paid off house and open line of credit if needed. Now we need to work on the condos...

    Quote Originally Posted by djrolling View Post
    I would keep enough to live on for a couple years. Then when disability is in place pay it off if you can. We have three mortgages. Our house and two investment properties. When we had our taxes done this year he missed that we had mortgages and we were going to owe $400. Caught the mistake and with mortgages figured in we got back a little over $400 so there is no big benifit not to pay off the mortgage. We are on point to have our house paid off by the end of 2017, about 9 years early, and then we will tackle the condos. The interest on the house for a year is more than $400. Maybe if you have a really expensive house "maybe" the numbers might come out different but I have my doubts. If you add the interest of all three mortgages together I would be paying around $2000 a year in interest to avoid a $400 tax bill. I am not sure where this thing about not paying off your house to keep your tax deduction started but I doubt it would ever work out to a real savings.... When you do your taxes have them figure it with and then without the deduction and then look at how much you are paying in interest each year. Compare your tax liability without the mortgage deduction and what you pay in interest each year and it will be easy to figure out
    ^^(A)^^

  3. #13
    Senior Member Oddity's Avatar
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    Quote Originally Posted by darty View Post
    This is the strategy we have used and our tax advisor has recommended to us. We feel much more comfortable with a paid off house and open line of credit if needed. Now we need to work on the condos...
    This is what we did, too. Paid off, opened a HELOC for 1/4 the property value, started paying ourselves the old mortgage payment into retirement account. The tax deduction for mortgage interest pales in comparison to how much more you end up paying for the property over the long term of a mortgage IMO.
    A Buddhist monk walked up to the guy working behind a hot dog cart and said, "Make me one with everything."

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  4. #14
    Senior Member darty's Avatar
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    Yes we still make the monthly mortgage payment but pay it into our retirement account.

    Quote Originally Posted by Oddity View Post
    This is what we did, too. Paid off, opened a HELOC for 1/4 the property value, started paying ourselves the old mortgage payment into retirement account. The tax deduction for mortgage interest pales in comparison to how much more you end up paying for the property over the long term of a mortgage IMO.
    ^^(A)^^

  5. #15
    Quote Originally Posted by darty View Post
    Yes we still make the monthly mortgage payment but pay it into our retirement account.
    I don't think Sarafino has a monthly income to "pay herself". Or she won't have one in the near future?

    Quote Originally Posted by Sarafino View Post
    Am I better of holding onto my money for now
    How are you holding your money? Can you generate income from it? I'd like to have more than 5k available until I knew how things were going to go. Do you expect your condition to decline..at what rate? This sounds like a timing issue. I like to delay making hasty moves without a good plan.

    If your going to go for SSDI get on it asap. Will it hurt to make mortgage payments from your savings for a couple months. It buys you time. Paying off the mortgage shouldn't take much time to excute the transaction...you can't predict how long SSDI application will take. My 2 cents.
    "Never turn your back on fear. It should always be in front of you, like a thing that might have to be killed." - Hunter Thompson
    T5/6 complete

  6. #16
    Senior Member Joe-MN's Avatar
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    I think that this is very important advise.

    Quote Originally Posted by nonoise View Post
    There some things to verify. SSDI used to be awarded, calculated on your *last* 40 quarters of earnings. So if your current earnings are diminishing, so will your SSDI award if you wait.
    The other is that the date of award is the date you apply even if you are denied and have to appeal. Layers usually won't help until you've been denied.

    I wish I'd done it 20 years ago. My SSDI benefit would have been more than SSI at the time since I quit working at 49. As the years rolled by I watched the potential SSDI benefit zero out.

    5K is not much of a nesteqq, better hold off for now.
    Better to remain silent and be thought a fool, than to speak and remove all doubt.

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