Pay down land loan and/or save for rental?
Hi Everyone, Quick question for you guys! I know answers will vary and a lot could depend on a number of variables but I wanted to get your thoughts.
I recently purchase 5 acres of land for $65k. The land is meant for my wife and I to build a house in the future. I put $30k down and have a loan of $35k @4.5% interest amortized over 15 years, balloon at 5 year. My banker is saying that I could utilize the equity in the land up to 75% LTV. I could pay the land off in about a year and a half and use the equity to buy a rental in the $60k to $160k range. Condo or SFH. or pay it off in 5 years and save the difference in cash if I were to pay it off in a year and half.
Main question is should I pay down the land loan in that year and half or 5 years? Which do you think would get me closer to my first rental deal?
Thanks!
Logan