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Question for the Money Doctors

Question submitted on Apr 8, 2020.

Question

Should we consolidate two mortgages into one. One of them is a rental with 5 yr left, and the other is a vacation home with about 15 yr left on the mortgage. They are each about $50k. I'd prefer to pay them off, but my husband feels it's a better tax break to keep the mortgages and combine them.

Answer

There may not be much of a tax break because the standard deduction for a married couple is over $24,000.  It appears the amount of mortgage interest plus your other itemized deductions may not be enough for you to be itemizing.   Accordingly there is no additional tax savings for keeping the mortgage.

However, for financial reasons, I would consider refinancing into a 15 year mortgage for the combined loans and work on paying off the mortgage.


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