Common questions around paying down your mortgage

These are the two most common questions I have come across when even I had a discussion around paying down the mortgage faster.

1. Would I not pay a lot more interest on my mortgage if I don't pay it down?

Very valid question. Yes you will pay more interest on your mortgage than what you will pay if you pay it down faster. However, consider this: You pay down mortgage with your after tax income.
The cost of paying down your mortgage is 33 to 45% tax and the long term growth. It is much cheaper to keep your mortgage and save the tax and have tax sheltered growth. If you don't have any other debts than the mortgage, you may use the tax refund to pay it down. I invite you to take an opportunity to understand the real cost of paying down your mortgage so that you could take an informed decisions. You could post your questions on this forum or call me at 416 840 5943.

2. What is the other situation when paying down your mortgage is not advisable?

For most people, it is very common to have a borrowing of some sort, in form of loans credit lines and credit cards. Interest rates on these accounts are typically higher than your mortgage and in some cases as high as 20 to 25%. One can save a huge amount or interest and monthly cash obligation if any excess cash is directed to this debt.
Remember, mortgage is still our cheapest debt. In certain cases, it is cheaper to even increase your mortgage to pay off these debts. As I had mentioned before, I would love answer specific questions from anybody who would like to take the time out to understand his or her debts get a better handle on monthly payments.