Benefiting from the Virus and Forbearance...I think!!!

[Patrick Hester]

I am planning to do a forbearance on all of my rentals (only 3:)), pocketing the rents w/o paying the mortgages, and at the end of the forbearance period, because rates are so low, I hope to refi all of them next year without having to pay the forbearance period payments back. Does this sound right to you?

The current rates on my rentals are between 4.75% and 5.5%. I just had my offer on a duplex accepted and my 30 yr rate is 2.8%. I know I am guessing but I doubt rates will increase much beyond 5.5% in the next 8 months. Moreover, if I start to see rates take a big upward turn, I could just refi then. My main objective is to use the forbearance to collect all of the rents and then refi into a lower rate. Even if the rate goes up close to what I have now I will still see a lower pay because my balances are less than the original loans. 

[Nick C.]

Have you spoken to your lender about the forbearance? This may effect your ability to refi, I don't know all the ins and outs, but you may want to check ahead to see if the forbearance goes on your credit report. Hopefully your tenants have a better moral compass than you, and don't do the same thing to you and stop paying rent.