u/moldy13

My fiance (28f) and I (32m) are getting married in November of this year and my aunt called me the other day and said she wanted to give us a creative wedding gift and offered to pay off my mortgage. Was hoping to get some people's input on our situation to help determine the best financial strategy.

Background

I purchased my home about 8 years ago for $350k and I currently have ~$250k remaining on my mortgage. I refinanced in 2020 to a 3.0% interest rate. We plan on moving to the suburbs in 3-4 years, but I was considering holding onto my property and renting it out since it's close to a college in the city we live in. My fiance has ~$300k saved up, so we'll be able to purchase a house in the suburbs without having to sell my city property to remain financially stable.

Before my aunt goes and pays off my 3.0% interest rate mortgage, i'm trying to think through all of our options to make sure we're doing the right thing. These are the different scenarios I could think of:

1. Pay off the mortgage outright and reallocate my monthly mortgage payment (~$1,400) to my brokerage account.

2. Don't pay off the mortgage and put the $250k into my brokerage account. Continue making $1,400/mo payments, eat the 3% interest, and hope the market continues to outperform my mortgage rate.

3. Pay off a portion of my mortgage (~$150k) and put the rest in my brokerage account to hedge against a market crash.

Basically trying to figure out of it's dumb to pay off a 3% mortgage when there is a high probability that the returns of whatever I invest the money into will outpace my interest rate.

Currently own 1 of 6 condos in my building in Philadelphia, PA. We are currently stuck with a management company that does not communicate with the board at all and from 2021 to 2025, did not hold a single budget review meeting for the upcoming year. Because of this, we were constantly running a net income loss YOY. Around 2023, the management company starting using our reserve funds to pay for operating expenses without notifying us and without asking the board to vote on the reallocation of funds. We have now borrowed $8,000 that we are now required to pay back into the reserve fund.

In a vacuum, I wouldn't think this is a huge deal because the operating expenses are real expenses and they needed to be paid for. My issue is that multiple people have moved out and new people have moved in to the other units throughout the past few years. Had the budget been properly updated and called to a vote, the budget shortfalls would have been paid for by the people who lived in the condos at that time. Now, we have new people who are on the hook for expenses occurred before they even moved in and i'm concerned that people might be deterred from buying my condo when they see an $8,000 debt on the COA balance sheet.

I was reviewing our master condo insurance plan for our building that the management company originally picked for us and I saw we have Employee Dishonest Coverage. I did some research and it seems like this situation could potentially qualify for a claim under this protection since it could be considered "unauthorized use of reserve funds" due to the management company never notifying us and never allowing us to vote on the reallocation. Does anyone have experience with this? I'm not sure if reallocating funds applies to this or if it means the management company stole the reserve money from us / theft.

Our policy lists "6 employees" under the coverage, which lines up with the number of total units. Is the management company still lumped into this since they're the ones managing the funds?