Updated almost 7 years ago on . Most recent reply
Second Investment Property Help
Thank you for your time.
We turned our first home into investment property in 2016, and we are getting $1200 a month. The house is paid off, and its worth around $170K right now.
We purchased our primary residence for $290K(Current value 340K) with 30 yr fixed rate %3.8($150K remaining principal balance as of today) . The money we receive from rental property goes into our primary residence principal and we have about 6 years of payments left(As long as I keep my current job). I have around $60K in the bank however I can't save any money from my income. I have also around $100K in retirement account with my current company.
My intuition tells me to pay off the current residence in 6 years, and make it another investment property; we can then purchase our primary residence again. My only issue is that the cash is tied up with the houses(Equity) and I would like to purchase another investment property with equity line credit right now, maybe a house valued around $130K-$140K. I can only put around $50K down and the rest is mortgage. Its probably going to take another 9-10 years to pay it off. I won't be making any money from both rentals, is buying second investment property before paying off primary residence mortgage a good idea?