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Rental property finances

Asked by: 1805 views

I looking for advice on what I should do with my rental properties. I have 4 rentals plus my home.

1st 700mth rent, 560 total payments 5.75%int

2nd 635mth rent, 600 payments  5.75%int

3rd  500mth rent, 310 payments  6%int

4th 800mth rent,  625 payments. 6%int

My question is should I try to pay these off or try to accumulate more property. My problem is that I lost my job and have no source of income other than rentals proceeds. The reason I really want to pay these off is because of me losing my job. I would like the extra cash flow so I would have less pressure on me financially. I dont want to sale any of my properties. My goal is to own 10 properties free and clear and then retire using the monthly proceeds. I am 31years old and have about 20k in savings. I have no ways of obtaining a loan now because no one here does no doc loans anymore. Please give me all of you guys advice on what to do in my situition. Thanks

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    get a job on Oct 01, 2010

    Without income these days…forget it.  You cannot refi nor get a new loan.  You need to find a source income and show a history of working.  If you are working as self-employed they will discount a portion of that income towards your qualification criteria.
     
    Also I am assuming you got those other loans as a rental property loan and none are as “primary or vacation” homes?  Otherwise it will be even harder.



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    Brian on Nov 04, 2010

    I think it’s a great goal to pay off those 4 mortgages and retire, but where are you going to get the money to do so? $20K isn’t going to pay off those mortgages.
    One possible strategy is to use some of the money to buy a new investment property, that you could either flip or sell for a solid profit within the next few years.

    The best case scenario is probably if you got a job, and continued to invest in real estate on the side, with the goal of selling off all but a few and putting the proceeds toward paying off those mortgages.

    When paying down mortgages, here are two strategies to consider:
    1. Pay off one mortgage at a time, creating extra income each month (better for earlier retirement)
    2. Pay all down gradually, which will slash the amount of interest you’re paying (better for paying less interest in the long term)

    If you’re interested, come grab some free rental forms at my website EZ Landlord Forms, and best of luck finding employment, it’s a jungle out there right now.
    Cheers,
    Brian


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