Should I pay off my second mortgage?

I put this in GQ hoping that there is a straight forward answer, but this thread might fit better in IMHO so move away Mods if you feel this location is wrong.

To the question: My wife and I have a first and second (actually home equity line of credit) on our house. We have no other debt. The line of credit was long ago turned off by Countrywide even though our credit is great. With the current financial crisis and our unease about the economy, my wife and I been paying this debt down much faster than we have to, putting an additional ~1-2 k$ toward the principle each month. But it occured to me that this might not be the best thing to do and here is why: If the economy really goes to shit (i.e continues in the direction it is going) and both my wife and I lose our jobs, we really need to have enough money to pay our primary through the bad times. If we default on the second, the only thing they can do is put a lien on our house, but if we can’t pay the first we will go through foreclosure. So it seems to me that we should pay the minimum on the second and hoard the extra… Yes?

Yes, pay the minimum and quit paying down the principle. The economy **will **get worse and in spite of your excellent credit rating, you will not be able to get credit. So if you lose your job, you will be sunk. You won’t be able to get another home equity loan due to the decline in the housing market. So pay the minimum and save the rest for a rainy day.

Thanks, thought so…

One thing you might consider: if you pay extra on your primary loan, will you later be able to use that extra to fund a payment holiday?