My rental property is worth 120K. Profit?

[Kassie Carrell]

I have a house I rent out for 1300 a month. I owe 60K. It's worth 120K. How much should I be making annually on this income property. I feel my numbers are very low, but I am new at this so I am not sure. After taxes, insurance, mortgage, and property management fees I am left with very little.  I would appreciate any advice. 

Warmly, K

[Austin Fruechting]

@Kassie Carrell

Here's what I would do: talk to a bank about refinancing (and see if you'd qualify). At 75% LTV you could get a 90k loan with lower payments than you have now (30yr 4.5% is $456/month, $5,472 a year). This would give you more cash flow than you have now, pay off your $18k debt, and put $12k in the bank.

Take that $12k and use it to buy a duplex and live in one side using an FHA owner occupier loan. Then your monthly living costs will be next to zero. That combined with Dave Ramsey budgeting and you'll be saving very fast to continue to acquire.