Once upon a time I was a proprietor of a collection agency specializing in secondary and tertiary enforcement of judgment. Essentially, I collected judgments that other collection agencies or attorneys couldn’t collect. This meant I had to go where no one else would, such as levying upon one’s primary residence; that is, petition the court to allow the sheriff or marshal to auction it off to the highest bidder. In the USA, this varies from state to state, but generally speaking a recorded judgment lien (or Abstract of Judgment as it is called in California) that is the basis for liquidating things like real property. For a primary residence, however, the equity in that property had to exceed the owner’s exemption (sometimes referred to as the Homestead exception), which varies from state to state, and by class (such as single, family, retired, disabled, etc.). Nolo Press describes the Homestead exemptions of the California Civil Code Procedure in more layman’s terms here.
We live in a world where everyone is leveraged more than ever before. A trend that has ramped up for the better part of 40-50 years. If this is you, don’t feel singled out because you are in good company. Add to that we now live in a world where lawyered up opportunists are sue happy. I think it’s important to pay off or down debt, but do it wisely. You may feel better after paying down your primary residence, but you do so at a cost of less asset protection if below your allowable exemption. Find out what that exemption is for you, or whether or not it applies to you at all (based upon your locale). If you are above that exemption amount because of rising home prices, consider that home values are likely to stabilize (nothing goes up forever). Moreover, the dire thing that I am describing here is more likely to occur in time of crisis, and home values are likely to correct when that crisis hits.
Another thing to consider is “change”. I knew someone who received a large chunk of cash and used it to pay down their mortgage. Shortly thereafter the 2008 crisis hit, and their mortgage could no longer be kept up and the value of their home sunk. They ended up losing the home. They would have been in much better position had they held on to their cash to ride out the storm, and selling their home 10 years later when housing prices were inflated again as a result of the rapid expansion produced by QE1, QE2, and QE3.
Be safe, practice safe crypto.