All Forum Posts by: Walter Chong

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Walter Chong has started 1 posts and replied 4 times.

Thanks, all!

0 Votes

Wouldn't closing costs be the same either way, though? One is a 10 year and the other is a 5+5 without a need to refinance.

0 Votes

I have a choice between two mortgage options for a property I'm looking to purchase.

1. 10 year fixed at 4.9%

2. 5 year fixed at 4.375% and then 5 year fixed at the then-current 5 year Treasury rate + 2.75%

The way I see it, I should choose the first option if rates don't rise more than 0.9% by 5 years from today. I should choose the second option if rates will have risen by more than that in 09/2022.

Any thoughts? I realize no one can predict the future, but how should I choose?

Am I allowed to cross-post? It seemed appropriate to post in the private lending & conventional mortgage advice forum as well, but most places frown upon cross-posting...

Thanks in advance!

0 Votes

Originally posted by @Angela Yan:

I would go with the one that yields your biggest cash flow because the bigger your cash flow --- with controlled expenses can give you higher NOI. As you probably know, higher the NOI makes your property value goes up so when you sell it or refinance, you can get more money for your property.

Good luck! Also not sure what your goals are with this property but usually people never hold on to their note with the banks for very long, they are always refinancing to get money out or they flip to bigger projects every few years or so. This is how investors build wealth.

Maybe I am misunderstanding your post, but I didn't think the loan factored into NOI calculations?

0 Votes