Instead of paying down someone else’s mortgage, you’re setting yourself up for bigger and better deals down the road.Your first deal is going to depend on a lot of factors—how important is location?

Becoming a LandlordYour house appreciating at 5% annually = $25K/year.Your parents' larger house = $30K/year.Financing the PlanTake out a mortgage on your house to buy your parents' house.If their mortgage rate is lower than today’s rates (6.75%), keep their mortgage and assume it.Why It WorksYour tenants pay the mortgage—not you.Each monthly payment includes ~$300 toward the principal.

This is making my mortgage payment go from $2,293 to $3,308 per month. 

Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable).

Are you saying I need to take a second mortgage on the rental? 

The most important rule is to have the cash flow of the new property be able to pay all its expenses, mortgage, AND the line of credit back.

It seems that there is some risk associated even if it cash flows because our names will still be on the mortgage and affecting our DTI ratio.

Since the original loan remains in the seller’s name, you may need a nominee interest allocation to deduct mortgage interest, as the Form 1098 will likely be issued to the seller.

While less than 10% of the mortgage industry offers 40-year mortgages, here's something to factor in: they often come in with a rate increase of 20-35 bps.Assume 35 bps.$300k mortgage at 7.25% (30-year): $2,046$300k mortgage at 7.6% (40-year): $1,996Technically, it lowers the monthly, but not by much once factoring in the rate adjustment.

Why pay off the mortgage early?