Prepaying a mortgage may no longer make sense in 2022. That’s because the Federal Reserve recently voted to raise interest rates, with further increases planned for later this year. With increasing interest rates, investors might be able to profit from historically low mortgage rates. Yet, calculations are required to determine if mortgage arbitrage – making […]
mortgage arbitrage
More Risk for Less Return: Why Paying Off Debt – If Investing in Bonds – Make Sense; or Mortgage Arbitrage with Low Interest Rates
SUMMARY: Pay off debt if bonds make up any part of your investment portfolio. Even with a portfolio as aggressive as 90% stocks and just 10% bonds, anything with a non-zero interest rate should be paid off. This idea – to prepay debt if investing in bonds – comes as a surprise to those investors […]