Should I refi SF home investment 18 years into the mortgage?

[Marie M.]

I have called around, a mortgage buddy in the state the property is in said no, along with others. Currently at 6.5% interest with 85k remaining market value is 180k.  Rent at 1495 and mortgage with taxes/ins about 1350.  Just put new roof and ac on it. I see reasons to consider it especially because we want to keep it long term, it’s been a great little rental.  

This is my first day in biggerpockets, excited to look around! 

[Julee Felsman]

@Marie M.!

It depends... every refinance should involve a cost/benefit analysis. You need to share your goals for a new loan with a lender who can help assess the options.

With as low as rates are right now, you may be able to shorten your loan term to 15 years and keep a similar (or lower) payment. 

But there are lots of other reasons to refi. I'm refinancing a couple of properties with about 7 years to go on the existing loans to a new 20 year loan. I'm taking cash back and will be able to pay off the loans on several other properties. I'll be lowering my interest rates and improving my cash flow by thousands of dollars a month. I will probably keep paying my old payment to stick to a quicker payoff, but I love the flexibility that a lower minimum payment will give me.

Debating another refinance to take cash back and build an ADU at another of my rentals.

My advice, share your goals with a pro and have them run some numbers for you!

Julee