I would just pay yourself out of that cash that you're getting a savings rate. I'm all for getting out of debt, ordinarily, but I would keep "good" business debt on the books. Last thing you want is to get out of that mortgage, get the kids through, and then have to leverage it again in "who knows" what the lending environment will be.

If you have the $193k, than you have, effectively, 8 years of payments (literally 87 months, but discounted I would call it 8 or even 9 years), plus you'll make interest on the way.

I would charge (and collect) a nominal rent, too, with these kids signing a real lease. It is never too early to learn about the real world.

This post was edited on 2/6/24 at 11:43 am

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Posted by Billy Blanks

Member since Dec 2021

3811 posts

Posted on 2/6/24 at 1:40 pm to Ace Midnight

The other item to consider is I have a 5 year ARM on a place with a 239k balance. That matures in about 2.5 years and would be at a much higher rate (currently 4.5 currently.)

Dont' love that rental as much but it leases for $2500.

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Posted by Ace Midnight

Between sanity and madness

Member since Dec 2006

89595 posts

Posted on 2/6/24 at 2:22 pm to Billy Blanks

quote:
The other item to consider is I have a 5 year ARM on a place with a 239k balance. That matures in about 2.5 years and would be at a much higher rate (currently 4.5 currently.)

Dont' love that rental as much but it leases for $2500.

Completely separate analysis. If you're worried about the rental the kids are going to make "not profitable" for a period of time, either pay it off or stash the money to cover that.

I wouldn't shift to min-max somewhere else. If you have to refi that ARM, do it when it matures, IMHO. If you already don't like it, maybe cash out (meaning sell) that and look somewhere else to put that money.

This post was edited on 2/6/24 at 2:23 pm

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