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Updated over 2 years ago,
Any reason to not recast loans?
Some of my rentals loans have about 20 percent of the debt paid off. Given that we may be going into turbulent economic and times, and I work in an industry going through a downturn I figure now is a good time to improve my rentals balance sheet and improve cash flow a bit. I realize one negative could be the improved profitability will increase my tax exposure but I will probably do some cost seg studies this year to pull some depreciation forward to offset that and then some. Additionally with the fed tightening and raising rates I have some cash doing nothing that I am not motivated to put into the market so whatever small principal payments the banks would require to do the recasts seems like a decent use of money now vs letting the cash sit idle. Curious if any others are considering recasting their loans now, and if not, what downsides you see to doing it?