Rental Property Investor · CT · Member since 2021 · 2 posts · 0 votes
Hey all!
New to the forum and soaking in all the great info on here! With 20 year fixed rates dropping to historic lows today, I wondered if it makes sense to pursue a 20 yr fixed rate cash-out refi instead of a 30 year fixed for an investment property? Also what are your thoughts on "paying points" when doing a cash out refi? Newbie here, so any info is much appreciated!
20 yr and 30 yr rates usually are not to far off from each other. If you can afford the 20 year payment, even with an unforeseen financial hardship then it may make sense to save on the interest. Depending on how long you will keep the property will determine if the cost to buy down the rate will make sense. You need to look at how much you will save vs the time it will take to recoup that money. That all ties in to your financial status and what else you might want to do with that money.