80/20 ARM Loan $0 down High Rates 20 yr old investor, Am I Screwed?
I am 20 years old from washington, I managed to get a loan and buy a duplex w/$0 down 80/20 Arm loan 80@7.5% 115,000 and 20@11.5 32,000 Yes rates are very high but w/ 0 down and no assets I had to take what I was given. I will be paying interest for the first 2 years and I have no extra money to pay extra on top of my minimum payment. I am losing $. I rent out both units@$1125 + $115 water +75 add to mortgage payment so I'm losing $190 a month, I cannot raise rent it's already up there. I cannot refi for atleast 2 years or I have to pay 3600 penalty fee. I bought the duplex for 147,600 (including closing costs). It's been appraised at only 148,000 so I bought it at top dollar. Zillow says it's now worth around 153,000 and it's only been 4 months, it's probably bs lot of people said but maybe it went up who knows
Answer:
Let this be a lesson to you. Next time do a little more home work. Best to get rid of the property as soon as you can before the ARM adjusts.
http://www.denverpost.com/business/ci_43...
Depends on the time of the market bro. Reality swaps in like a 5yr swing up and down. Just gotta find the sweet spot and jump out. Best of luck to you buddy
Remember, any investment that loses money is a bad investment. Also, you have tied up your ability to get more money with conventional financing on other properties. I admire the go getter in you but this one you should have passed on. This will most likely be a thorn in your side. Also, when the ARM adjusts, your in for a world of hurt. I would immediately start advertising the property for sale at a much higher price and see if you can get someone to pay it! Leave the property on the market until you can sell it and get out!
I am at a loss why you bought the property in the first place.
You should strongly consider either refinancing it, if possible, at better terms, or moving in.
Pretending that it is your primary residence, when it isn't is only going to cause you other problems.
You are losing money roughly $200 each month, without building equity, on an ARM, and currently paying interest only? And you aren't even living there?
The penalty fee is considered interest and , I believe , is tax deductible.
You're renting out property that you don't own, what do you expect! You're just paying it back slowly.
Answer:
Let this be a lesson to you. Next time do a little more home work. Best to get rid of the property as soon as you can before the ARM adjusts.
http://www.denverpost.com/business/ci_43...
Depends on the time of the market bro. Reality swaps in like a 5yr swing up and down. Just gotta find the sweet spot and jump out. Best of luck to you buddy
Remember, any investment that loses money is a bad investment. Also, you have tied up your ability to get more money with conventional financing on other properties. I admire the go getter in you but this one you should have passed on. This will most likely be a thorn in your side. Also, when the ARM adjusts, your in for a world of hurt. I would immediately start advertising the property for sale at a much higher price and see if you can get someone to pay it! Leave the property on the market until you can sell it and get out!
I am at a loss why you bought the property in the first place.
You should strongly consider either refinancing it, if possible, at better terms, or moving in.
Pretending that it is your primary residence, when it isn't is only going to cause you other problems.
You are losing money roughly $200 each month, without building equity, on an ARM, and currently paying interest only? And you aren't even living there?
The penalty fee is considered interest and , I believe , is tax deductible.
You're renting out property that you don't own, what do you expect! You're just paying it back slowly.
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