Loan option question

[Candice Menard]

Situation-I am using a non-recourse loan along with my solo 401(k) funds to purchase a rental home.

Borrowing-130,000.00

Loan term options

1. Fixed rate20 year loan 6.5%

1. Variable rate 25 year loan

10/1

5.9%

1. Variable rate 25 year loan

5/1

5.5%

1. Variable rate 25 year loan

3/1

4.9%

I am planning to pay an additional $500.00 to $1000.00 towards principal each month.

Question-Would you mind giving me an opinion on which of the 4 options would serve me best and why?

[Daniel Hennek]

You are the only person who can truly answer this question.  You are the only one that knows your abilities and future plans with the property.  Therefore the only one that can ascertain how those loan options play into those plans.  The way it should work is that you have a detailed conversation with the loan officer who offered you these options and they help you explore why one might be better than the other based on different scenarios.  Sounds like that didn't happen? 

I suggest talking to the person who offered you these options in depth about this.  They are vested in discussing this with you and should take the time to help you vet the options.  Nobody here has enough context to give you any worthwhile advice.