[Alberta's Child]

I would never pay cash for a home. The tax advantage of carrying a mortgage is too attractive for that.

If I had enough cash to buy a home outright, I'd make the smallest down payment I'd need to avoid having to buy mortgage insurance (I believe it's 20%), then spread the rest of the cash in a diversified group of investments that can be liquidated relatively easily if necessary.

[ClaireSolt]

For the first time in my life I own my home and car. No payments. It is a wonderfully secure feeling.

[ctdonath2]

The tax advantage of carrying a mortgage is too attractive for that.

The great fallacy of mortgages: the "tax advantage".

Put simply, you're throwing away $7 to save $3.

Get a $100,000 mortgage.
On top of principal, you'll pay somewhere around $100,000 in interest - money that doesn't actually get you anything.
The mortgage deduction means you don't pay income tax on that extra $100,000, saving you maybe $30,000.
Upshot: you just threw away $70,000 so you wouldn't have to throw away $30,000.

Yeah, that's smart. You just turned $100,000 into $30,000 and got zippo for it.

Better to take that $100,000, pay the $30,000 tax, invest the $70,000 at 10%, and come out somewhere well over $150,000.

(The exact numbers probably vary, but you get the idea. I hope.)