All Forum Posts by: Tracy Graham

@Tracy Graham so there are some VERY distinct differences between these two products.  Now, some of the math here might be dependent on how you PURCHASED the property (with cash or with a loan) but just for concept purposes here's what I would say the differences are:

1. Lines of Credit have low costs but the rate adjusts

2. Mortgages are fixed Rates but have higher costs

What this means is that a Line of Credit is NOT designed to be a permanent financing solution. Two of the common areas of concern for HELOCs I see out there is the 10 year maturity date and the adjustable rate. Since HELOCs have adjustable rates they will often catch people off guard when they adjust. Rates are higher now...but what will they be in 5 years?, Who knows? That's called risk. Unknown = risk. The 10 year maturity date is where the HELOC will modify into a different product all together. Meaning after opening the HELOC, 10 years later it will cease to be a HELOC. It will "mature" into a 20 year fixed rate mortgage that you can no longer draw on. And when it matures the rate will increase. I've seen typical numbers of 1%-2% higher than your current rate.

What HELOCs are designed for is to be a giant credit card.  And just like any credit card, you need a plan to pay it back.  So if you use it to say....buy another property. Then flip that property...thus paying back your Line of Credit. Then that's perfect! Because you will never get surprised by an adjusting rate or keeping a balance on it. Lines of Credit are PERFECT for people who have a plan to pay it back.

On the other hand, if you were going to use that Line of Credit for the downpayment on a property that you were looking to buy and hold for 30 years....this would be very counterproductive. The 30 year fixed rate loan would be a better fit for this purpose.

You might be able to think of some other scenarios but hopefully this concept is good enough to know the difference between the two. 

Hope all of that makes sense.

I have that happen occasionally in my lower income units- really not too big of a deal as long as the place didn't get vandalized. 

First step - change the locks and secure the property

That said - I typically use semigloss everywhere - looks plenty good for a rental and seems to clean the easiest. 

Also does the bathroom have an exhaust vent? Have it wired to the light switch - that way when they turn the lights on the vent automatically comes on. I do this in all my rentals...along with grids in the drain (so nothing big can go down), removing the disposals (in lower end units)

Are you going to charge them for not informing you? A lot of places would charge you months rent at a higher rate for not informing the landlord in writing of their moving out to somewhere else!