Home Buying in 34236>Question Details

Laguna, Home Owner in 34236

I have a condo that is currently rented out with a mortgage at 5.75%.

Asked by Laguna, 34236 Thu Aug 9, 2012

Should I refinance my primary residence at a much lower interest rate and pay off the rental property? I plan on selling my primary residence and moving to the condo within the next few years.

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Lynn Brock’s answer
Laguna, This is an excellent question for your CPA.

If your present home is owned free and clear. In my opinion, no leave it mortgage free.

There are too many variables which you have not provided with your question. You are asked about a financial planning question pertaning to your retirement.

Best to speak with your accountant or estate planner.

Good luck,

Lynn Brock
Brock Realty Inc.

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0 votes Thank Flag Link Wed Aug 15, 2012
Call Keith Hamilton w First Federal Bank 941-685-2443..He can run different ways to see whats best.
0 votes Thank Flag Link Fri Aug 10, 2012
With rates in the upper 2% range for good credit borrowers, that is a no brainer
0 votes Thank Flag Link Thu Aug 9, 2012
If you are at 5.75% and you qualify for a refinance, you should definitely refinance your primary residence if you are going to be there for at least a year. (to fulfill your occupancy clause)

The comment about it not being worth it us not correct, you just need a loan officer to structure it with a slightly higher than market rate to absorb the costs so you don't pay for the refinance. Yes you will have a slightly higher rate that what is possible, but that is completely irrelevant if it lowers your current rate of 5.75% and you don't pay anything for it.
Web Reference: http://WeFixRates.Com
0 votes Thank Flag Link Thu Aug 9, 2012
My mortgage lender said if you are planning to move within the next two years it is not worth refinancing because you would not recoup the closing costs and you start paying higher interest up front on the loan all over again. I don't know how much you owe and what your situation is, how long you have had the loan, etc. I would check with a mortgage lender and a tax advisor to see what your best options are.

Tammy Hayes, Realtor
Green Lion Realty
0 votes Thank Flag Link Thu Aug 9, 2012
May I suggest that you sit down with your accountant and look at all the scenarios that make the most financial sense to you when you match the results with your long term goal. It may take a little time but you will have all the information laid out so you can make an informed decision.
0 votes Thank Flag Link Thu Aug 9, 2012
Ask your tax preparer if this is the best way to go and tell me what she says. The question is whether you can offset the rental income against the interest paid on your home loan if the loan is used to pay off the rental's mortgage. In other words how do you get maximum financial and tax benefit from your refinance plans.
0 votes Thank Flag Link Thu Aug 9, 2012
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