Bond payments are not tax deductable.

If you have enough equity in your home, you can take a home equity loan to pay off the bond. You can get a better interest rate and the interest is deductible.

Bingo. Even better alternative to pay off or not pay off. Thank you HawkFan.

Paying off our bond has been a topic of discussion in our home many times. I would use our Home Equity line of credit at Prime plus 1/4 which is in place for another 10 years as long as we continue to own our Northern home. Also we are dependent on the Federal Reserve to continue to hold the interest rates at this low percentage. We also have read on occasion that Congress has talked about disallowing mortgage interest deductions which would hurt the new and existing homeowners.

But we also know that many upgrades, landscaping, etc, in our homes doesn't guarantee a 100% return of our costs if we decide to resell. They would "help" to sell the home and make it a bit different than the same models that are out there.
So, that is the conundrum.

I see the bond as a purchase of the "lifestyle" rather than the purchase of the home, thus I don't get too concerned about recovering that amount if I were to resell my home. That's probably bad thinking from an economic standpoint, but its the way I see it.

we don't really care whether paying the bond off or not impacts the sale of our house or if we recoup what we paid This is house #2 in TV for us and we don't plan on moving. Selling our house will be our kids problem and everything they get from it will ne a "profit" for them

IF I had a bond on my house, I certainly would take a home equity loan and pay it off and would be able to deduct interest on the loan.

However, I bought a beautiful resale home that had no bond remaining which was a big contributing factor in buying it. The home also had every other thing we wanted plus some things we had not thought of before.

paying bond off early
 

The trouble with the argument of paying it off early for me is I don’t have enough deductions to itemize, they way I figure it I would save $156 a year on a $12,000 bond since the interest does me no good. I still haven't decided what to do.

Ideas, please....
 

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We didn't pay off the bond on this house or on our first one. BECAUSE, you never know, it may be our previous house if we buy a third one. We did pay for both houses, but chose to let the bond ride, so that if we listed it to sell we would not have to include the paid off bond into the price of the house and make the price point more sellable.


We are very satisfied with our home, but ya never know what those people are gonna build next and we may just fall in love with a new floor plan.


I thought that when we bought our first house that it would be our here-'til-we-croak-FROG house but here we are in another one. We have downsized and know how to do that, we just might want to buy one of those sweet patio villas, or a beautiful ranch, or a new designer might catch our fancy. We ain't dead yet, and we may want another home here.


So for now the bond is not paid off on our home.

We paid it off as part of our closing last week. Over a 30 year period the bond will triple in cost. For us, it was down to dollars and cents. We aren't convinced it's tax deductible. Having gone through an IRS Audit we don't want to put it to the test.

There are no right or wrong answers to paying the bond off. Simply personal preference.

It's not tax deductible.

I paid my bond off two weeks ago, as it only was a few hundred dollars.

I don't plan on moving, ever!!!!! I justed to get it over with and only pay the txes due, on this structure.

Since property values have increased dramatically, will the new taxes be proportionately higher?

Inquiring minds want to know........

GREAT! Now you can start working on mine!

where do you pay the bond off is there an address