Why Shouldn’t You Pay off Your House Early?
Homeowners who are interested in paying off their home loan early may want to learn more about why they should not pay off their house early. Paying off a house early can result in some benefits, however it can also come along with some negatives that have the potential of outweighing the benefits.
If a borrower has the funds to pay off their house early, most professionals recommend that they do not rush to make the last mortgage repayment. While it is tempting to go ahead and pay off a home early, there are benefits to following through with the established time frame. A borrower with an existing mortgage and low credit score can greatly benefit from continuing with their scheduled repayments as their credit score can increase.
Another reason that paying off a house early is not entirely beneficial to borrowers is if they are looking to keep a line of credit open in order to look like a trustworthy borrower to their home loan provider. Homeowners who are interested in paying off their house early should reach out to their existing home loan provider to learn more about the various benefits and disadvantages that can come along with paying off a house early.
Mortgage professionals generally recommend for borrowers to have three to six months of mortgage repayments readily available in their savings in order to be adequately prepared for their required repayments. If a borrower does not have adequate savings, they should not pay off their house early.