Paying off a Rental or Primary Res. -- Yay or Nay?
Hi BP Fam - The hubby and I have enough money saved to pay off either 1 of our rentals or our primary residence. Wondering how others might approach this, what makes the most sense, and why. Below are some data:
1.) Rental 1 (Condo) - $200k left on mortgage w/ a 5% interest rate. Cash flow take home would be $1100/ per mo. (includes PM fees & HOA).
2.) Rental 1 (SFH) - $260k left on mortgage w/ a 5% interest rate. Cash flow take home would be $1,830/ per mo. (includes PM fees).
3.) Primary residence (SFH) - $330k left on mortgage w/ a 3.2% interest rate. Mortgage payments are on a 15% yr. fixed escrow acct. We pay about $3200/mo.
NOTE: About us, we're pretty conservative in our decision-making and dislike debt. We're thinking of paying off one of these properties before buying our next rental.
Thanks in advance for any tips/advice!
Most Popular Reply
having little to no debt on rentals and your personal residence lets you sleep well, there are a few people in biggerpockets that have actually been through that in the past. Use leverage for Rehabs in order to build cash reserves to then buy more rental properties with very little debt or no debt... I like to sleep....