Why not pull 160K out of your IRA, take the tax hit, and pay your mortgage off completely, and then save money for retirement, with a totally paid off house?
Then, your home will never be taken away, unless you can’t pay your property taxes, which you will have to pay, either way.
Carrying debt is just not good, especially if you have funds stashed somewhere. Debt is for poor people, not folks with $$!
Examining interest paid, and tax deduction, vs how much IRA is appreciating, looks good on paper, appealing to a persons inflated sense of his own wisdom and street smarts, and that type of thinking might make you money, if you are Goldman Sachs, but it doesn’t really work for normal middle class folks.
In fact, I would state that this type of thinking, being so comfortable with debt, is the ruin of the present generation, and what got us into the mess, temporally speaking.
Also, there is the larger question of the IRA, and what types of investments the gov’t allows you to make in this context. IDK much about it, but I wonder if you can buy gold, or commodities with an IRA? Directly?
Me, I would rather have the house paid off, cash in my wallet, or where ever I choose to spend/save it, than letting the gov’t manipulate me into subsidizing Wall Street thru the tax code.
The wealthiest people I know, and a few are really wealthy, also have the most debt. It's not hard for them to manage it, but the debt is still there.