When to pay off home equity loans...?
After spending a ton of time on this site and listening to a bunch of podcasts, I am finally taking action. I've got a partner with experience in rehab/holding/flipping and today I began the process of getting a home equity loan.
We are putting together a business plan and looking at properties. We found a nice auction single family that we will be bidding on in the next month or two.
I know that leverage is good, but as part of my plan, I want to know when to pay off loans. Do I try to do this as I go? Maybe buy a couple properties, then throw money at the loans? Let the entire loan run it's coarse?
The terms of the loan I am looking at to get me started are interest only for first 5 years at a variable rate (3.75 to start), and I believe amortization over the following 10 years, for a total of 15.
Keeping in mind that in the next few years, my wife and I will want to buy a more permanent home (currently house hacking a duplex), what should be my plan for payoff?