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Auto Loan vs Mortgage

Bogleheads • View forum - Personal Finance (Not Investing) - www.bogleheads.org
Wife and I max out 401ks, IRAs, and 529 for the kid.

We have a 6 month EF.

Only debt is one auto loan (29k @ 0.9%) and a mortgage (248k @ 4.625%).

I have PMI on the mortgage, it's a conventional 30 year loan (we're almost 3 years into the loan now).

Original value on house was around $281k, not sure on value now, Zillow doesn't seem very accurate (fairly new neighborhood, added a pool, etc.).

The car payment is around $680/month.

I'm considering the following, need some opinions:

a) pay off car, frees up cash flow, would drop EF to 2 months

b) take the $29k that would pay off car and get my mortgage down to 78% of original loan value to knock PMI out, obviously this also drops EF down to 2 months

c) something else?

Our jobs are relatively stable and I believe we could build EF back up to 6 months before any potential job loss.
Date: Jun 19, 2017   


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