Sell/Refi/Payoff my current home
Hi Everyone--
I wasn't sure exactly where to ask this question and sorry it’s so long but here goes....And yes, I'm OCD. lol
Goal: Buy/Hold Residential properties to exceed my current income after medical insurance costs and taxes. I also want to get away from SunTrust Mortgage ASAP so they can't mess up my credit anymore.
Dilemma: Trying to figure out where I should be applying all of my extra money to achieve goals the quickest way.
Current asset:
- FHA primary residence, $52,000 mortgage balance, lived here 12 years
- 6.75% APR
- 14 years left of mortgage with SunTrust (Can't stand them. They take over a week to apply payments and have even lost payments but are quick to cash the check!)
- Neighborhood - good rental area - low vacancy - house values currently increasing
- Ran house through Rental Property Calculator and showed cash flow of between $0-$100/month currently. House built in 1940 so Cap Ex runs a little higher than a new house. Used numbers on the high side to be conservative.
- Current equity is $25,000 if I sold my house today, not including selling fees. House would sell quickly.
- My house is the highest interest rate debt I have currently.
Variables:
- I have 5 dogs, including 2 pitbulls (makes relocating a bit difficult but not impossible)
- Chap 13 bankruptcy successfully discharged in Oct 2015 but my credit score is 719 as of Dec 2015. I'll probably have to wait two years before doing anything anyways, Oct 2017.
- Low money saved so far but able to save a lot more now.
- Credit would be back to almost perfect again in two years to open up a lot more financing options
Current options I've thought of so far:
- Refinance house with different lender, 30 yr fixed mortgage:
- Cash flow would be $300/month after 4 years when rented out
- Mortgage would go back to 30 years
- I'd have to wait some due to refinance ding on my credit before financing another property (maybe two years?)
- Four years to save for down payment on another house (20% down-conventional)
- Rent would pay off house
- Cash flow would increase to $500/month after 26 years
- Refinance with a different lender for a 15 yr fixed mortgage:
- Mortgage payment wouldn't change
- Cash flow $0-$100/month for 11 years
- Cash flow $500/month after 11 years
- Again, a ding on my credit due to new mortgage (maybe two years?)
- Four years to save for down payment on another house (20% down-conventional)
- Rent would pay off house
- All extra money into paying off current mortgage:
- I could pay current house off in about 5 years
- Three years to save money for down payment on another house (could use FHA again)
- Cash flow would be $500/month as soon as house is rented
- I would pay off house
- Continue making minimum mortgage payment, extra money into savings account:
- Four years to save for down payment on another house (20% down-conventional)
- Cash flow $0-$100/month for 10 years
- Cash flow $500/month after 10 years
- Rent would pay off house
Anything I missed or any words of wisdom on which path I should take to be able to jump into investing as quickly as possible?
And, as always, you guys rock! :) Thanks in advance!