Pay Down Rental Property Mtge for Guaranteed "Tax Free"Return

[Livefree]

I just made this decision and paid off my second rental property 2 weeks ago, after 2 cd's came due and the interest quoted was not worth it. Paid off the first one about 10 years ago..now the cash flow is allowing me to max my 401, Roth, and after Tax accounts fully.

 

[gerntz]

Correct, it's a 30yr fixed loan.

So,you're suggesting pay down the existing loan AND refi the remainder at a lower rate? If I could do that for ~0 refi costs, that might be worth the effort.

No, I'm suggesting you refinance at the lower rate & pocket the difference.

 

[gerntz]

Yikes, get a new mortgage broker. 30 year fixed, conventional loans are definitely available for investment properties.

Yep. Have 4 of them.

 

[Nords]

I'm confused. You got a fixed rate 30 year loan on a rental?
I own two rentals and have never heard of such an option. Rather my options have been a 5-7 year balloon amortized over 30 years. As such, your rate will reset in 5-7 years...so don't bank on that rate being available for the life of your mortgage.
As for how I do it, you don't want to know...very complex but it works for me.

A fixed-rate 30-year investor's mortgage is so simple that even Bank of America can do it. Although for the life of me I can't understand how they're making any money from us.

As for complex real estate transactions: you're right, I don't want to know.

 

[tryan]

I like paing down the note on your primary residence .... invest in property with others $$.

If you want investment real estate , use the cash for a downpayment on another property. Lots of ways to get POSITIVE cashflow today.

Breaking even is a lost because you're not being paid for your time.