- Sep 8, 2014
- 25,445
- 59,410
I was born and raised in Orlando, but in spite of piving in Cullman for the past 30 years I dont really know many people here. I commute to work in Madison, Alabama....have always been a commuter so I know more people outside of Cullman than in except for family.
Anyway, I have these on what I consider to be crappy terms....6% over 20 years, but had to move fast. Now that I have time I want to find a lender that can do terms closer to typical rates in the 3-4% range if im not going to pay them off. Im leaning towards paying them off even though i know using someone elses money to expand could be far more lucrative
There's absolutely nothing wrong w/ paying them off. "Savvy" investors will tell you not to pay them off and use the money for this or that....but small time investors (like myself, and seemingly you - not to offend you) have nothing to worry about w/ having it paid off. My only rental (which we use as an airbnb) is paid off, worth maybe $180k. I've had people tell me to take out a mortgage on it - and I've told them to f*ck off. I own it outright!
Interesting about where you live. If you get bored, read "Rich Dad, Poor Dad" - it's basically a book about real estate and starting your own business (the benefits of tax write offs, etc). He talks about the "1% rule" - which is basically being able to rent a property for 1% of what you bought it for per month (such as paying $200K and getting $2000/month in rent). The 1% rule is getting harder and harder to come by. So if you're finding properties where you can hit the 1% rule you're doing very well. I had a house two doors down from me sell in January for $640K, the buyer immediately put it up for rent for $3000 - that just doesn't make sense to me. There's rural areas of Florida that you can get the 1% rule, but not many urban/cities. Good luck.
Also, you should easily be able to refinance the properties, especially since you have well over 20% equity.