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Just received my appraisal report. The value of the condo increased by more than I expected. Its now valued at $171K and 75% LTV comes to $128,200 which the bank tells me is the max loan amnt they will do. In 2011, it appraised for only $154K. I still gotta kick in around $20-30K though as the current balance is $146K.
Still very tempted to refinance to go after that $450/500 savings a month. Like I said earlier, I can not sell this condo. My tenants lease doesnt expire until mid 2016.
Last edited by AssociateX; 10-07-2015 at 08:43 PM..
You can sell it with a lease in place. The lease and everything just goes with the new buyer.
In theory, this can happen but in practice (at least in my area) this just wont work. Its a 1 bedroom condo in a 6 story building that is around 90% owner occupied. No one will want to buy an apt with a tenant still living there and who *may* present problems with moving out. In a buyer's market, any potential buyer sees something like that and they wont be interested in assuming a lease and dealing with cleaning up after a tenant leaves or being an accidental landlord. So..just..no.
Either way, it doesnt look like I will bother refinancing. Spoke to a few more mortgage lenders at HSBC and Chase who all agreed given my situation, it is not ideal to kick in so much $$ just to reduce rate by barely an 8th of a point. I guess I just have to suck it up and deal until my tenant moves out next year and I can list it.
Paying the dollar to save the quarter costs a heck of a lot less than paying $25,000 plus the $5000 in closing costs to not pay the dollar.
First off, $5k in closing costs would not be incurred if the current loan is kept and paid down. Second, you cannot assert that an ongoing expense (which, by the way, is much more than $1.00/month) is less than a lump sum without specifying the time period you are amortizing over and the implicit return rate of a comparable alternative. Without these factors, comparing a lump sum to an ongoing cost is like comparing a length to a velocity and saying one is greater than the other.
Can you put $ into the property allowing you to not only raise the monthly rent but also have the place appraised potentially Making the LTV 80% removing PMI. It would be a win-win if done right.
Yes, do list it when your tenant's lease is up. Nobody needs to be an absentee landlord!
Big congratulations, though, to the condo's board on allowing so few rentals in the building.
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