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Loan was financed in 2006. No details in the article on the loan other than what I already mentioned.
The rate is good, and it's fixed, which is good - it's the first ten years of interest-only and the percent of her income that I think are insane.
10% annualized appreciation? Maybe. Maybe not.
Rent increase of 4% / year. I have no idea how realistic that is.
Maybe she will be a RE millionaire in ten years. But if her roommate moves out and she loses her job, she'll lose the house at loss in a couple of months. Even if she doesn't lose her job but can't rent out the other unit, she's sunk. Too much risk. Leverage is a double-edged sword.
And I have no interest in a tax-payer funded buyout for her.
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TickTock Rule Of Finance - heavily discount any promises of money/benefits to be paid to you in the future
"I've traded love for pennies, sold my soul for less" -Jim Croce, Age
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