My Mom is about to collect on an insurance policy. When it's all said and done, she'll have about 550K in cash.
She still has a first and second mortgage.
House value is about 215K.
She owes 136K on the first but the interest rate is 5.25. I don't know how much she owes on the 2nd but it's about $185 a month. First mtg is about $1400 a month and includes insurance and taxes.
She makes about 3K a month but needs to live off of about 50K a year to keep her standard of living.
Her financial advisor wants her to pay off the house. However, if she does that, the money is no longer liquid, it's not earning anything and she'll lose the tax advantage of the interest write off. Any ideas?
2007-06-12
04:14:49
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21 answers
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asked by
mojo
1
in
Personal Finance