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Whiskey, Tango, Foxtrot | I was in the same boat a few years ago. Wife and I are both frugal, and we had enough saved up to pay off the mortgage on our home place and fields it sits on (all one parcel). We had a pretty good interest rate, and figured interest would only go up on anything we bought later on, so the cash to apply to a down payment would be more advantageous. So we kept the cash and didn't pay it off.
Now, interest rates haven't gone up, but I still feel like it was the right move for us. We had enough cash to put large down payments on some ground we've bought since. Nicest thing, is with the larger down payments, they didn't need any other collateral for those loans. I have no doubt we could have bought that ground without as large of a down payment, but we'd have probably had to use other ground for collateral.
I'd rather have a mortgage that is a serviceable amount, and cash to self finance operating and machinery vs. having a paid for place and need operating and equipment loans. I've never had to borrow money for operating or equipment, and it has saved us a lot of money over the years. Land is the only asset that will appreciate, I don't mind having some debt there.
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Should I pay off my farm mortgage?
