And why would it ever be a good idea to borrow if you can pay cash and pay no interest to the bank?
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If you can make more money doing something else with your cash than using it to pay down your mortgage, then it’s beneficial to take out a loan. It depends on your credit rating what kind of interest you’ll get on your loan, and what the long term stock market trends are, or if you want to buy multiple properties at the same time, for example.
But making money in the stock market is not a given, so there is risk involved in going that route.
Also, you want to have cash on hand for possible emergency situations, like big unexpected medical bills, your car dies, you lose your job, etc.
On the other hand, if you lose your job and you have a mortgage, then you might end up defaulting on your loan, and lose the home and any of the equity you had in it.
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