But even so, I don't understand why people (you're far from the only one) say this. For every dollar you save in taxes, you're paying two dollars to the bank. H

But even so, I don't understand why people (you're far from the only one) say this. For every dollar you save in taxes, you're paying two dollars to the bank. How can that possibly be smart? That plan is to take the money you have invested in your personal dwelling, and leverage a government subsidized low-interest loan (mortgage with deductible interest) to re-invest for a higher return. Obviously it doesn't make sense for everyone - it requires that you have a low enough paper income that you aren't in AMT territory (and can thus deduct your interest) and that you are comfortable investing that money in something higher-return and presumably higher-risk, though the last few years have shown that your personal dwelling isn't necessarily a low-risk investment either. The short answer is that for every two dollars you pay to the bank in interest, you should be making more than two dollars in return on your subsequent investment.