All Forum Posts by: Matthew Christian

Thanks for the advice @Account Closed.  After discussing further with the wife, I think we'll probably just ride the variable rate for as long as we can.  If the interest rate goes up too high, we can just sell the property at that time.  We have enough equity in it that we won't have to bring cash with us to closing.  It saves us the $3000 in closing costs.  

I don't really have a solid long term plan for the condo.  Part of me would like to sell it and not have to be a landlord anymore.  Having it not hanging over my head is somewhat appealing as we don't live near it anymore.  

But, it's been fairly easy the last 5 years.  We haven't gone a month without a tenant.  We had one issue with a water leak, but insurance covered that.  Otherwise, I keep seeing the rent go up each year, and so that's nice.  The property manager takes care of everything.  Sure, I'm paying someone a fair amount of money to do all of this, but it has been pretty much headache free.  If I didn't have the mortgage, I would be getting $9-10k cash flow per year out of it.

Anyway, I appreciate your advice.  I might call a few more lenders and see what other rates might be out there.  Interestingly, I think the rate they are offering me is about a point lower than what I was paying during the 5 years before it became adjustable!

I found myself as a reluctant landlord 5 years ago.  I had to move across country from my condominium.  I couldn't afford to sell off the property at a loss and ended up renting it out.  I have a property manager and it's been fairly easy.  I am overall cash flow negative on the property, but the loss is usually around $1000 per year, and we typically pay down about $4500 per year in principal.

I had a 5/1 ARM, but didn't refinance it at the time it changed over to yearly rate change. The variable rates have been good. This year we are at 3.5%. The rate is capped at 6%. I recently looked into a refinance. A 30 year mortgage for $145k would have $3k in closing costs rolled into the loan. PITI would be about $1100 per month. The rate is 4.625%

My current loan PITI is about $1200 per month.

The condo was appraised at $186k through the HARP process.  Probably more like $170k is what I could sell it for.  I currently owe about $140k on my loan.  20 more years are left on the current payment structure.

Is it worth it to get a fixed rate for an extra $100 per month cash flow, but at the same time know that I am spending more in interest over the long term?  The negative cash flow of about $1000 per year is not really that big of a deal for me.  I make plenty of money with my regular job and don't consider myself to be any sort of real estate professional.

Thanks for any advice.