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money on the second mortgage and focus on getting that second mortgage paid off. If that second mortgage is on an investment property (rental, etc.), then you'd clearly need a more comprehensive evaluation of your financial picture to figure out the best place to put the money. If you are truly not carrying ANY debt other than the two mortgages, and they are both on separate properties, at competitive market rates, and you have 6 months of living expenses socked away in savings immediately accessible to you, then you truly are in the dinette set/Z/play money situation. Obviously, this presumes you are also setting aside an some sort of investment plan a monthly contribution for the kids' college expense, although you may have another avenue available to you there, if you are fortunate. On the mortgage payoff tip, to simply dump that $ towards the principal of your mortgage would save you very little in interest versus the potential cost to you in attaining that much cash at short notice if you needed it. Better to handle all other high-interest debt first, then set aside cash for your emergency buffer, then calculate how quickly you would like to have your mortgage paid off, and do the math using an amortization table to figure out the additional principal required to reach that goal. Add that to your monthly payment and there is your non-mandatory 15-year (or whatever you determine) mortgage. Regarding carrying two notes on the same property, since you are in Texas, you cannot mortgage more than 80% of the appraised value of your property at this time through a second note. So, it is hard to get yourself in a situation where you have mortgaged all your equity. However, it can be ugly dealing with multilple note holders with something as valuable as your most precious asset.
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