Rental Property Scenerio

[Aaron Impens]

Lets say I have 10 rental properties. They all have exactly the same terms (4%, 15 years), all bought on same day (for sake of argument). Which one do I pay off first using the "snowball method" i,e, using all available positive cash flow to pay off one loan before the others)?

If I had different mortgage rates, I know I should pay off the highest mortgage rate loan first, but I don't.

Do i pay off first:

1. The one with the highest loan or lowest loan value first?

2. The one with the poorest cash flow or best cash flow first?

3. The one with the best or poorest cash flow to loan value?

4. The one with the the highest potential cash flow if it were paid off completely

5. There is no difference.

Lincoln, Nebraska; Omaha, Nebraska

[Josh Nix]

I would pay off the one with the lowest balance first and then roll that cash flow into paying off the new lowest one etc...

The idea is that when you pay off the smallest one completely you've made a small victory towards your life/end goals. Mentally it helps keep you on track and gets the next one paid off faster and it will be a series of small victories that will snowball on its self and create its one sense of momentum.