Which one to pay of first or to prepay on all of them equally
I have 3 loans against my house, when I bought my house for 145K 3 years ago I had a 80/15/5 loan (to avoid PMI). And 2 years ago I got a HELC for 15K
Loans – (current balances) [monthly payment]
#1 – 116K (112K) @ 6% fixed for 30 years [$836]
#2 – 21,750 (19,860) @ 6.75% fixed for 30 years [$165]
#3 – 15K (14500) 4.25% adjustable for 20 years
My monthly payments for #1&2, including taxes are $1001. (I prepay my insurance) payment for # 3 varies but is $215 per month right now.
I CANNOT refinance, I have tried for 3 months now, with different companies, the numbers don’t make sense, and there is too much cost for it to help me.
I dont live in the property; it is a rented for $1050 per month.
I dont have any plans to sell it.
maybe i will try to refi or sell in a year
If you know of an online calculator where is can put in all of my figures and do it myself, i looked but coulnt find one.
Pay off the highest rate first by paying some extra each month. Right now that’s #2. If #3 becomes the highest due to a rate change then start adding some extra to #3′s monthly payment. If you get rid of #2 and #3 you will have positive cash flow (monthly income exceeding monthly payments).
You should always have a mortgage on a rental property. If you don’t, all of the income is taxed as regular income just like your paycheck. The mortgage payments will offset some (or all) of the rental income and can be used to create tax free income through refinancing.
Pay off the highest rate first by paying some extra each month. Right now that’s #2. If #3 becomes the highest due to a rate change then start adding some extra to #3′s monthly payment. If you get rid of #2 and #3 you will have positive cash flow (monthly income exceeding monthly payments).
You should always have a mortgage on a rental property. If you don’t, all of the income is taxed as regular income just like your paycheck. The mortgage payments will offset some (or all) of the rental income and can be used to create tax free income through refinancing.
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the only way you will reduce the overall payment is if you get a 30 yr loan for 143k (all) for probably 6% or less, which I think is unlikely at this time – the value of the house may be less than the balance of the loans which is why you haven’t been able to get refinanced – house prices have dropped 20+% in a lot of areas in the last 2 yrs – why did you keep pulling equity out of the property? if you stayed with the just the original mortgages, you’d probably have positive cash flow
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