I'm looking for advice given a home that became a rental property. It's currently operating at a loss, and I'd like to get opinions on if I should keep this long term for potential payoffs 10,15,30 years from now, or cut my losses and sell the property.
For context here are some numbers:
$255,000 - Estimated appraisal of home
$230,000 - Current mortgage balance (I bought in 2007 with 0% down - I know, I know)
5.25 - Interest rate
$2150 - Monthly P+I, Taxes, HOA, etc
$1800 - Rental Income from property
$350 - Monthly losses on the property
Hi @Kyle Centrella . I would sell if you are between tenants anyway. If occupied, I may wait until they move. With zero equity (after sales costs) and a monthly loss, get rid of this headache and move on. Goes double if the home is out of your area and/or you need to free up your debt ratio to buy again. It's ok. You are better off than many that bought in '07 and have to bring cash to closing because they are underwater!
@Kyle Centrella I am in a similar situation. I bought in 2005 and I'm currently renting with $400 of monthly losses. It's currently on the market as a potential short sale to do what @Steve Vaughan said, "Get rid of the headache." I'll take an unwanted credit hit but the goal is to move forward making better decisions. Good luck.
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