It's one of those "it depends" issue.
Strictly comparing a MMA vs. a mortgage. . .I think the no-brainer is paying down the mortgage.
You earn a 6% effective return when you pay down a mortgage early (or whatever your interest rate is). When you put in a MMA. . .you are going to get about 4% tops, and if it isn't sheltered. . .more like 2.5% after taxes.
What you are talking about is "leverage" though. Yes, by actually preserving the money in the form of "principal" in your MMA. . .you have more leverage with that money. Although this really isn't so much true as home equity is a good form of leverage.
The other benefit to giving it to your mortagage company is societal.
Most of our economic problem right now is "lack of liquidity" in the mortgage department. . .if everyone sent in an extra payment to our mortgages, the banks have more to lend. . .in fact, they have to lend it to make money. . .thus, it would restimulate the economy.
If Uncle Sam really wanted to stimulate the economy, they would have sent money for 2 mortgage payments that were earmarked rather than going out and blowing it on swimming pools, tatoos, or Disney World.
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