freedomCM_IHB
New member
congrats!
looking forward to the pics of the soon to be PS pad!
looking forward to the pics of the soon to be PS pad!
Should I pay off 2nd mortgage or save for downpayment?
- Thread starter Trooper_IHB
- Start date
NEW -> Contingent Buyer Assistance Program
lawyerliz_IHB
New member
You buy your house, and I will try to fly out there to see it.
Never been to Cali.
Seems to me you should either put all your savings into your rental house,
or all of it into your fund for the 20% down. Unless you want to pay it
down enuf to get to the break even point if you re-fi. Nope that won't
work as rates will probably go up a lot. Really, what you are in the hole for monthly
is hardly anything. And your first won't be paid for for a long time, so
I'd go for saving the whole thing.
Never been to Cali.
Seems to me you should either put all your savings into your rental house,
or all of it into your fund for the 20% down. Unless you want to pay it
down enuf to get to the break even point if you re-fi. Nope that won't
work as rates will probably go up a lot. Really, what you are in the hole for monthly
is hardly anything. And your first won't be paid for for a long time, so
I'd go for saving the whole thing.
lawyerliz_IHB
New member
A further thought. . .
Since you have a 6% fixed, you are probably paying down $190 per month in
principal, so are actually breaking even. Plus there is some tax stuff--
you have to depreciate, right?
When you do want to sell, don't forget the 1031 exchange thing, so you
don't pay any taxes, and I think you get to depreciate all over again, right?
Since you have a 6% fixed, you are probably paying down $190 per month in
principal, so are actually breaking even. Plus there is some tax stuff--
you have to depreciate, right?
When you do want to sell, don't forget the 1031 exchange thing, so you
don't pay any taxes, and I think you get to depreciate all over again, right?
biscuitninja_IHB
New member
Awsome work! Not many people can claim that, and even more nowadays.
-bix
Forgot to add... you are my Heroine!
-bix
Forgot to add... you are my Heroine!
usctrojanman29_IHB
New member
[quote author="lawyerliz" date=1216527046]A further thought. . .
Since you have a 6% fixed, you are probably paying down $190 per month in
principal, so are actually breaking even. <strong>Plus there is some tax stuff--
you have to depreciate, right?</strong>
When you do want to sell, don't forget the 1031 exchange thing, so you
don't pay any taxes, and I think you get to depreciate all over again, right?</blockquote>
Yes, there is a good chance that he may benefit from an active real estate tax loss from the rental property that he can deduct from his ordinary income due to the depreciation along with the monthly loss (check with your tax professional to make sure you qualify).
Since you have a 6% fixed, you are probably paying down $190 per month in
principal, so are actually breaking even. <strong>Plus there is some tax stuff--
you have to depreciate, right?</strong>
When you do want to sell, don't forget the 1031 exchange thing, so you
don't pay any taxes, and I think you get to depreciate all over again, right?</blockquote>
Yes, there is a good chance that he may benefit from an active real estate tax loss from the rental property that he can deduct from his ordinary income due to the depreciation along with the monthly loss (check with your tax professional to make sure you qualify).
usctrojanman29_IHB
New member
[quote author="nirvinerealtor" date=1177266993]<p>Trooper,</p>
<p>If I am in your position, this is what I would do.:</p>
<p>1. Pay-off the 2nd because you are paying 9.5%.</p>
<p>2. Apply for a HELOC and do not touch it. The money is there for you like a checking account but you are paying $0 interest as long as you have $0 balance. I have been reccommending my client to consider Cal Bank for HELOC. It cost $0 for loan fee. My rate with a bank in New York is Prime - 0.75% ( or 8.25%-.75% = 7.5%). <strong>I am pushing Prime - 1% and they are telling I will get it when they run special</strong>.</p>
<p>3. For you, apply a HELOC directly with your bank. Your rate will depend on your loan-to-value ratio and your credit worthiness. Make sure you negotiate rate. There should be no fees.</p></blockquote>
You don't have to wait for any specials...Third Federal has a HELOC of up to 85% LTV @ Prime -1.01% or 3.99% today (see link below)
http://www.thirdfederal.com/homeequity/products.cfm
<p>If I am in your position, this is what I would do.:</p>
<p>1. Pay-off the 2nd because you are paying 9.5%.</p>
<p>2. Apply for a HELOC and do not touch it. The money is there for you like a checking account but you are paying $0 interest as long as you have $0 balance. I have been reccommending my client to consider Cal Bank for HELOC. It cost $0 for loan fee. My rate with a bank in New York is Prime - 0.75% ( or 8.25%-.75% = 7.5%). <strong>I am pushing Prime - 1% and they are telling I will get it when they run special</strong>.</p>
<p>3. For you, apply a HELOC directly with your bank. Your rate will depend on your loan-to-value ratio and your credit worthiness. Make sure you negotiate rate. There should be no fees.</p></blockquote>
You don't have to wait for any specials...Third Federal has a HELOC of up to 85% LTV @ Prime -1.01% or 3.99% today (see link below)
http://www.thirdfederal.com/homeequity/products.cfm
Trooper_IHB
New member
Just to clear up any confusion.....I originally posted this in <strong>April of 2007</strong>. I only bumped the long dormant thread b/c I had this news to share.