Pay extra or save for more investment (DENVER)

[Adam Parker]

Hi all

New to investing but just purchased my second property in Colorado. I own a single family in Centennial (3.5 interest rate) at about 50% equity and took a HELOC out to (fixed 3.99 interest) to purchase my newest property in Denver (3.49 interest). Newest property will be cash flowing 1145 a month after paying HELOC and Mortgage. My question is should I pay down the HELOC since it has the highest rate (new withdraws will not be at the 3.99 as that was a promotion that ended) or should I save money and start saving up for the next property. I am already 30% equity in the newest property as well, so another HELOC and another property would be a possibility.

Any advice and thoughts welcome! Thanks

[Kyle Groseclose]

Considering your HELOC is a 4% interest I would personally consider it an "extension" of your mortgage. It is money loaned to you at a 4% rate. Would you pay off a mortgage at a 4% rate?

My personal action would be to continue saving for your next property. I am certain that you can make more than 4% on your money! Go get 'em!