I think it’s best to pay off one’s mortgage before turning 45! But given that’s not the question, I’ll repost it here then answer:

“I will retire in about 2.5 years. I have a small mortgage, $100K. I have heard that it is best to pay off ones mortgage before retiring. My financial advisor says keep it as a tax write-off in retirement. I have about $500K in my retirement IRA. What do you advise?”

Home price declines are now so severe they have erased all home equity for more Americans than ever before. Home equity numbers have been recorded starting at the end of World War II and are now at there lowest level in history. For many home owners, their mortgage debt actually exceeds their home’s value…what is called negative home equity.

As the name implies the payments on a reverse mortgage flow in reverse…not from the borrower to the lender but from the lender to the borrower. A reverse mortgage affords older homeowners (62+) that are “house rich” and “cash poor” to receive their equity a little each month.