Many financial analysts can show you why it makes little sense to pay off a mortgage. They note that mortgage interest is one of the few major tax deductions still available for middle-class Americans. It can be demonstrated that investing the money in the stock market or even a certificate of deposit would give you a better return in the long run. Additionally, emergencies or major expenses can occur unexpectedly.

However, if you just hate the idea of all that debt, you’re not alone. The Census Bureau’s American Housing Survey for 1995 showed that 24.5 million people owned their homes free and clear. That’s about 38.6 percent of all homeowners.

Such mortgage-free households are not in the majority. The Census figures show that 34.7 million of the 63 million homeowners in 1995 had one mortgage, 4.2 million had two mortgages and 52,000 had three or more mortgages.

If you want to join those 24.5 million who no longer make house payments, you can take one of two approaches. You can do this in a systematic way or just add as much as you can afford to your mortgage principal whenever you can.

The Systematic Approach
Since less than 2% of all homeowners with a mortgage prepay their loan on a consistent basis, most of us need the systematic approach.

You can work out an amortization chart of your own through the amortization & prepayment calculator. You’ll be amazed at the difference in interest paid on a 30-year and 15-year mortgage. If the payments are too steep, try a 20-year and see how that works. Here's how:

• First, use your current loan balance and interest rate and calculate a new payment based on a 15-year amortization. This new payment is how much you have to pay each month to pay your mortgage off in 15 years.

• Then compare this amount to your current payment and add the difference to your monthly payment.

For example, if your balance is $130,000 and your interest rate is 7.5 percent, your monthly payments on a 30-year mortgage are $908. If you had the same balance and interest rate with a 15-year mortgage, the payments would be $1,205. So increasing your monthly payment by $287 a month would lead you to a zero balance in 15 years.

Once you decide how much is the right amount try changing your payment method to a direct draft of your account. Even the most disciplined approach may go astray without some help. A direct draft will keep you on track.

You will also want to watch interest rates. Depending on your outstanding mortgage balance, refinancing to a shorter term at a lower rate may be more advantageous than prepaying on your existing loan.

For more information consult a licensed mortgage loan officer.