Debt Paying strategy

10 Replies

Im looking for creative ways to accelerate my mortgage.     

I don't want to use my cash all at once, because I want to keep my reserves high.

So I'm looking at ways of getting cheap cash.   Im thinking of taking a cash advance of about 10k from a cc, and putting it towards one of my newer mortgages.    Then transferring the balance to a 0% apr 18 month cc.  Then pay it off in the 18 months.    From what I have calculated it would save me 32k in interest.

@Gareth Fisher

I have mixed emotions about paying down my primary mortgage.  I currently have a 3.75% loan.  While I would save some (a lot of) interest to pay that off, I also feel like the cash I would use to pay it off could make significantly more than 3.75% on a RE deal.  I think one of the prevailing opinions within BP is to use debt wisely.  If you have hard money loans at 12%, get out of them as fast as possible with lower rates... but if you have a long-term note at sub-5%, I would expect you could use the cash you'd be putting into paying down your mortgage to make more money elsewhere... just make sure you're making more than the interest you're paying on your mortgage ;)

I'm no professional RE investor (yet), so take my thoughts for what they're worth.  Good Luck!

Originally posted by @Josh Mitchell :

@Gareth Fisher use your cash to buy more properties so other people pay your mortgage and you don't have any issue.... 

 I have to currently personally garuntee these mortgages.  Giving the world economy is being supplemented by fake money from the feds.   I don't feel very comfortable taking on any more debt at this time.

okay thank goodness I cant get voted down for this as the shame comments I am sure are gonna come for this one.... I was young and dumb once and made a wonderful life of making every wrong choice you could and racking up about 50k in debt from school loans to taxes to anything you could think of... then I got lucky and met my wife who is my financial guru :) through HARD work "I work 60-70" hours a week and still do slowly I turned my shameful 520 credit score to over 700 by using your exact method well close to mentioned above... Never ever had a cc before but lucky wife was able to get a 0% for 21 months 10k cc for me to start I took every bit of debt I could and threw it on that bad boy and made massive payments I chewed through my debt in a very fast way this way... after that cc offer was over I opened one for my self rinse and repeat however this does come with risk you cant over step what you can afford or you COULD "guilty and it sucked so bad I only did it once" and get nailed by the terrible after the 0% interest... since then I have used this "cc hack" I blame Brandon for my hack talk -_- to pay of everything from rehabing my own home to cars to trips to even xmas spending why pay interest to anyone? atm I have a 15k cc 0% I use to cash advance and pay off huge chunks of my home... I love it I am saving money on the interest and making massive cuts into my 30 year loan after I have x number of properties I will be using this method to steadily pay them of for my retirement and security but like anything that matters it takes hard work 

The loan from the 401k might be a good idea given how frothy the stock market is.  But, as a wise man has said, you can never time the market.  

I like to stay diversified, so don't like putting my 401k funds into real estate unless I'm in a pinch.  I think of it more as reserves in case sh** hits the fan.

I've been thinking of a clever way to use 0% APR credit cards. I think I will use this strategy to get out of my PMI :)

 Should I even be using my personal funds to pay debt? or should I let the rental incomes take care of that.  Use my personal income for other stuff.  It all seems to be a wash at the end of the day or one Giant math problem.   The one mortgage is at 4.5   how ever what I look at my payments I'm only paying a 100 towards the principle and 300 towards interest.   I'm assuming that's because its a scheduled.   Seems to be a lot more then 4.5.