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paying off mortgage

A

Austin Carpenter

Member
Some guys at work tell me its stupid to pay off my mortgage early. I have a low 3.25 percent on a fifteen yr loan. How do u guys feel about this?
 
get the advise from a financial planner or expert not the chums at work. can't wait to pay mine off.
 
What is the benefit of not paying it off early? Some people think the interest they deduct on their taxes saves them some money.I don't understand their logic as it juste increases your total investment into the property.My thought is why pay more money in interest than you have to.

JMHO

Vito
 
The faster the better! Your interest is no longer deductible on your Federal income tax. Years ago that was a SMALL benefit to having a home mortgage but that went away several years ago. Every penny you can pay towards the PRINCIPAL of your loan saves you interest money. That is money that your paying your lender to use their money and it"s how they get richer and richer. All of this IMHO, take it or leave it. Sincerely,
Logan
 
(quoted from post at 07:18:21 03/08/14) Some guys at work tell me its stupid to pay off my mortgage early. I have a low 3.25 percent on a fifteen yr loan. How do u guys feel about this?
Click to expand...
ts not really yours until you get it paid for. Some folks have told me the same thing, but the way I see it is interest paid is money gone forever, I would rather pay off early and save on interest, and free up the payment amount, than spend the extra every month.
 
Doesnt matter how little your interest payment is. Pay it off as fast as your wallet will let you. What if the place you work at closes, or you get hurt or sick and your income stops? What if the economy crashes again? Pay it off, then the amount you pay each month will be yours to keep, not give to the bank. Difference between a 30 year and fifteen year pay off is 12%. If you can add 12% more to each payment you will save paying 3 years worth of money. That sure would buy a handfull of old tractors and paint.
 
Look at your amortization and see how much interest you are paying over the life of the loan. Then decide if you are better off with that money in your pocket or the banks. The answer should be pretty easy to determine.
 
pay it off. why would any one in there right mind want to give a greedy banker more interest fees than they have to. then you can put that money in YOUR retirement account instead of THERE'S. just my .02c
 
Before credit cards came along, You had to have a loan and pay in a timely manner to have good credit. Today I use my credit or debit card most of the time. I pay it off each month. I have not had a loan in at least ten years and have a rating of over 800.
 
At the time I paid off my mortgage the brothers I worked for (who were heavy into real estate) laughed at me saying I was stupid and I should invest that money in more real estate. I paid it off and shortly after was the next recession. They lost everything and had to declare bankrupsy. I had a good laugh about it.
 
I went through this with a couple jokers I work with a few years ago. The only thing I could come up with is they are too broke or stupid to be able to pay any more than the minimum and were jealous that I could. IMHO, why should I give any more money to the bank than I have too especially when my banker said there was no penalty for early payment? BT
 
My thoughts on paying off your loan early is that is a good idea if that is the highest rate of interest you are paying on any type of loan you have. Also, if you intend to buy something else and finance it and can't get a lower rate than the one you have now, let this loan stay in effect and pay for whatever you intend to buy. Always feels good to pay off a mortgage and know it is all yours. Be safe!!!
 
pay it off and experience one of the greatest freedoms ever. I assume someone told you about all of those tax deductions. compare interest paid and taxes paid and then consider; interest paid to corporations that provides a lavish lifestyle for a few and as much as I hate taxes they do provide for: military, education, infrastructures and other advancements.
 
A lot of factors come into play with this. 1) If the money you are using to pay off the mortgage can earn more interest from investing it, I wouldn't pay it off. 2) As stated before, if you don't 100% own, no one can take it from a law suit. Otherwise, it becomes a liquidated asset some greedy sue happy person will take. 3) If you are at the end of your mortgage, there is no tax reason to keep the mortgage. Only the interest is tax deductible and at the end of a mortgage, there is little to no interest.

I will have to agree with Dave Ramsey on this one.....GET COMPLETELY OUT OF DEBT AND LIVE ON CASH FROM HERE ON.
 
Math is hard for some people; logic, too. They probably think their mortgage interest cuts their income taxes on a dollar-for-dollar basis.

Reality is you only get a small part back, and that's only if you can use itemized deductions. Most people can't anymore.

The sad part for your co-workers is that it doesn't take much of an additional monthly payment to cut the term in half, but you have to start at the beginning.
 
Why would it ever be stupid to get out of debt? I paid mine off as quick as I could. I wasn't gonna drag it out to the end for nuthin.
 
I agree with Old Bob. If you have other debts with a higher interest rate pay them off first.
There can be good reasons to not pay off a mortgage early, but IMO one of the best things you can do is get out of debt and stay out.
Once you're out of debt take the money that you would have been spending on loan payments and put it towards your retirement.
 
Actually, interest is still deductible on income tax, if you can itemize deductions. But you have to have about $12,000 in deductions (charity, mortgage interest and property taxes are the big ones) to beat the standard deduction, and at your nnalert, I doubt you have that much.

It really depends on how much cash you'll have left after paying it off. If payoff will take most of your cash, don't do it- you need cash reserve in case your job goes away, etc. If your mortgage is $70,000 and your payments are $500 a month, you can make a lot of monthly payments out of the 70K, to get you over a rough patch. If you spend it all on a payoff, sure, you won't have payments to make, but you also won't have any cash to get you through hard times.
 
Pay it off, that will free up money to pay the other KING, the school, county, city their property taxes. We never really own anything, just renting from the KING. Don't pay your property taxes and someone else will own it. Sad but true. gobble
 
Ya I can pay more every month. I have a good chunk in a ira and that has been doing good. And I have a checking account that gets 4% on up to $10000
 
I have to agree with your friends, but perhaps not for the same reasons. Paying off your mortgage early makes sense if you have a high interest rate or many years left to pay. It really doesn't make good financial sense for you, because you have a dirt cheap interest rate and 15 year mortgage.

I can say one thing about interest rates with absolute certainty: THEY WILL GO UP! As discussed in an earlier post, the Fed discount rate is essentially zero, so the only possible direction for interest rates to move is UP. You are locked into a 3.25 percent interest rate loan for the next 15 years. THAT IS A BARGAIN! Let's say you take that money you would pay against the principal and put it in the bank. Five years from now let's say you want to buy a second property and the interest rate for mortages is now 6 percent. You can use the money you put away against the principal of the new house, essentially paying only 3.25 percent interest for that amount versus 6 percent for the rest of the balance.

Another way to look at it is this: If you pay down your mortgage now, you're getting an effective return of 3.25 percent on your money. That's better than bank interest, but not much. The stock market has been doing much better than; the long term return for the DJIA is around ten percent. Did I mention that interest rates will be going up? You'll feel silly about paying down your 3.25 percent mortgage if bank interest rises to, say, 4 percent.
 
I've heard that kind of talk all my life; seems it goes from one dummy to another. If you have the cash, pay it off!!! I've always considered interest as money that you are just throwing away, if you have the cash to pay it off.

Had neighbors that sold their business and he wanted to pay off their home mortgage but her friends told her not to pay it off. Now they are real sorry that they didn't pay it off, because she spent the money on things that they didn't need.
 
If paying it off means you wouldn't contribute to an IRA or 401(k) then don't pay it off. Put something away for retirement for sure.
 
You have some good advice here, and some not so good advice. Keep in mind that you must have cash reserves for emergencies so it is a bad idea to run yourself too short. Also keep in mind that under today's warped credit rating system your credit can actually suffer if you do not have some debt. Line up your debt in order of interest rate. Pay off the highest rate debt first and proceed down the list until you have it gone. I don't believe in paying interest or rent unless I have to. Beware of the following giving advice:

1) The "guys" at work. Experts of the break room/coffee machine/water cooler shooting off their mouths usually only understand 5% of what they are talking about...or less.

2) People who tell you they can "invest" it for more than you are paying and you will get ahead. These are the folks who mortgaged to the hilt in the 90's, spent it on God only knows what and played the market then defaulted on their debt when the crash came and left all of us in a mess.

3) Lawyers who preach tax code. Sorry, and I mean that sincerely, but they usually are not well qualified, speak in generalities, and refuse to back down when challenged. They are a curse in my biz.

If you can do so safely, and have no higher interest debt, pay off your mortgage and invest the payments you WOULD HAVE made in good solid investments. In short, be your own mortgage holder...you won't regret it.

Dave H (MI CPA)
 
I think it would be wise to be "debt free" of everything by the time you retire.....biggest killer of Happy Retirements is debt...and bad health...one more easily planned for than the other.

Tim
 
If you can afford to put some more $ onto your mortgage payment, why not use that money to invest it in a money market? I have some bucks in Franklin High Income that makes me 7.3% over the last 9 years. Lost about 20% in the 2008 crash, but recovered and added to the value in 3 months.
At 7% your $ should double every 7 years.
If your loan is 3.25% then you would be netting another 3.75% or better by NOT paying it off early. Intrest WILL go up, use the banks $ to m,ake more for yourself!
 
Google financial guru Dave Ramsey's baby steps (or buy his book)...

Do believe it is:
1. build a 3-6 month cash reserve - enough to cover all living expenses
2. pay off all debt - starting with debt on which you pay the highest rate of interest... once that one is paid... just pay off the next, and the next, etc.
3. live like no other now... so that someday you can live like no other! (Meaning eat beans and weinies for a few years if you have to, to accomplish your financial goals... so later in life you can live with no worries and enjoy life).
 
If you can get a better guaranteed return on your money from an investment then it's probably just as well to do that rather than pay off the mortgage... especially if that investment is fairly liquid and you have a floating rate mortgage that could be paid out at any time. If you get into pre payment penalties, all the more reason to not pay it out.
On the other hand.... if you're just going to store money in a bank account or term deposit where it makes less that your mortgage interest and there's no pre payment penalty for early payment... best money you're going to make is by paying the damn thing off.
At the end of the day tho.... do what makes you most comfortable. It's your money.

Rod
 
Thanks for asking this Austin.
My new wife and I have been asking similar questions here.
I hope you don't mind if I horn in a little on your thread.
Fellas,
The deal here is we're thinking about selling her townhome and taking the equity from that to pay down some of my debt.
It wouldn't pay off everything but it would put us in a position to be debt free in about 5 or 6 years.
Some folks say we should rent her place and not sell it. Renting would give us around $500/mo above and beyond her mortgage, homeowners assn fees, etc.
But to my way of thinking, paying down my debt would give us at least $500/mo in savings on interest and reduce our liability.
We're kinda leaning towards selling but not real sure what to do.
 
It is hard to put a price on peace of mind. I paid mine off years ago because I just liked the feeling of stability and safety that comes from having no debt.

Had a friend that retired with a big mortgage, and I got tired of listening to him worry.

In my case and with my mental outlook, life is too busy and hectic to go through all sort of schemes, transfers, machinations, juggling etc etc for 1% return difference.
 
One-year CDs were returning 4 percent as recently as 2007. Bank interest rates closely track the Federal Reserve discount rate. Should the Fed decide inflation is rising too fast, they won't hesitate to raise interest rates. A four percent discount rate in the next couple of years is unlikely, but in five or six years I wouldn't be so sure.
 
If you can in fact pay it off do so that saves you X amount every month plus the interest. But that said if you have no other loans and say you need one in 5 years you may find it hard to get one due to not having a credit history found that out this summer when we wanted to buy a car and since I had payed every thing off 4 -6 years ago I had to do a heck of a lot of looking to get a loan
 
You mistakenly assume that the interest rate on long-term debt obligations somehow controls future interest rates. Actually it's quite the opposite: The value of that treasury note will go up if short-term interest rates drop and down if interest rates go up. (And of course interest rates can only go up right now.) I hope you did your research before you bought that T-Note, because it's going to be worth a lot less in the not-too-distant future.
 
There's a lot to be said for being mortgage-free. Not having the payment is one thing. Not paying interest is another. After paying off the farm, my grandmother kept a $1000 "mortgage" loan on the farm so she could get the mortgage deduction on her property taxes, and the mortgage interest deduction on her income taxes. But once the standard deduction raised, it no longer paid her to itemize, and the tax "savings" for having a mortgage disappeared...so she paid off the mortgage and never had one again.

If the economy tanks again and jobs disappear, wouldn't it be great to own your property free and clear? My dad always told me to plan for the worst...and then if the worst never happens, you'll always be ahead of the game. I think that's good advice. And if the worst DOES happen, you're also ahead of the game, because you had a plan in place.

Without a mortgage...couldn't you do other things with the money you're now paying? Sometimes I think the folks who advise you to NOT pay off a mortgage are simply jealous because they're not in a position to pay theirs off.
 
(quoted from post at 10:37:58 03/08/14) Google financial guru Dave Ramsey's baby steps (or buy his book)...
Click to expand...

He did a very detailed and comprehensive study that revealed, 100% of foreclosures and repossessions were on homes with mortgages.

Pay the minimums on everything but the smallest debt. Paying as much as possible towards paying off the smallest first (regardless of interest rate) will give a sense of success. As the smallest is payed off, on to the next, then the next etc.

"We're debt freeeeeeeeeeeeeeeeee!!!!!!!!!!!!!!!!!"
 
my home was supposed to be paid off when I turned 55. Then the national mort co sold the loan to another national mort co. It cost me an extra 20000.00 yes that's right another 20000.00 to pay if off at 55. Pay it off as soon as you can.
 
Something is not right. The terms of your mortgage were set when you signed the paperwork. Selling the right to "service" your loan does not change the terms of the mortgage. Also, prepayment penalties are pretty much unheard-of with mortgages issued in the past thirty years.

What's the rest of the story?
 
That is a nice low interest % but if you can pay it off early while not depleting your "emergency fund" or put you in a bind some other way, pay it off as soon as you can!

Be wary of advice from the guys at work... Years ago my friend paid off his truck and the guys at his work who all had new trucks were trying to get him to finance a new one right away too. He asked what I thought and I asked him a question. Do the guys with the new trucks also have pockets full of cash, or are they a slave to the truck payment? He is still driving his paid for truck.
 
Ultradog- I do a lot of evictions, so am familiar with the pluses and minuses of keeping it as rental property rather than selling.

Depends on a lot of things- how old are you? If you're getting on toward retirement age, sell it- renting, even if it works out OK, is a long term deal as far as paying off debt is concerned.

Can you do your own repairs and maintenance work? Not just have the ability, but do you have the time (and the inclination)?

Where is the property in relation to where you live? If its not in the same town, you'll need to find a good property management company to manage it. You just can't do it long distance- someone needs to monitor it, and you'll be a bit put out, driving 100 miles to replace a main breaker in the middle of the night.

If its got a $500 positive cash flow, that's pretty good, and also indicates that it must be a fairly high-end property, which means you'll get high-end renters who have an actual job, and can afford it, and are likely to take care of it,rather than the bottom feeders who can afford $500 a month from L&I, welfare, and eleventeen other gumment programs. Poor people have poor ways, and thats why they're poor, in most cases. You'll do far better on a $1200 a month property with $700 mortgage, than a $500 a month property owned free and clear. You can go through a lot of 500 dollarses in a hurry, if the disgruntled renter trashes the place during the eviction.

The rental business is not for the faint of heart these days- just way too many bums out there. Also, the low interest rates have taken many conscientious and ambitious folks out of the rental market and into a home of their own.
 
yea back in the late 80s CDs were paying 15 to 18 % but thats old news right now the best deal at banks un less you have+ high dollars to the put in they are paying.025 i have paid off my mortgage back in 2008 boy do the saving add up
 
I recall at least a couple of Michigan banks advertising 4 percent CDs around 2005-2007. Citizens and Bank of America come to mind. But rather than rely on my imperfect memory, you can check for yourself. The Federal Reserve publishes historical information on various interest rates. In 2007, the average rate on six month CDs was 5.23 percent.
FRB selected interest rates
 
Because some people are dumb enough to think that paying a bank $5000 in interest is a better deal than giving the goverment an extra $1200 in taxes. Pay it off and have cash in your hand or in the bank.
 
(quoted from post at 11:03:51 03/08/14) Some folks say we should rent her place and not sell it. Renting would give us around $500/mo above and beyond her mortgage, homeowners assn fees, etc.
But to my way of thinking, paying down my debt would give us at least $500/mo in savings on interest and reduce our liability.
We're kinda leaning towards selling but not real sure what to do.
Click to expand...

Are you [b:3c388b75fb][i:3c388b75fb]sure[/i:3c388b75fb][/b:3c388b75fb] you will be $500 in the black each month? Most people underestimate expenses on rentals. The national average is 40% of rent and being a condo, with fees and early replacement of common areas, you should figure a higher percentage than the standard 40%.

If you have to pay a property management company, they will likely eat up profits at a pretty good rate. They are in business to make money, not break even and the money they make is all your profit, or it was before you hired them. Also, when a magement company has a call to fix something, they tend to be johnny on the spot fixing it. That makes them, as a company, look good so other renters want to live in a place controled by XYZ managment company. As such, they dont look for lowest bid or maximize saving money on repairs, its get-r-done... and fast. That translates to every time you let XYZ managment company have someone fix something for you, you are also paying a tax to the company for their good name. Think of it as when a sink leaks at your rental, they dont manage [b:3c388b75fb][i:3c388b75fb]your[/i:3c388b75fb][/b:3c388b75fb] money as well as you would and that extra money paid to the plumber translates to you paying XYZ'z advertizing that month. Does that make sense?

Not trying to talk you out of renting the condo, in fact I think it would be better to keep and rent but I want you to know the numbers. I have heard of people talking about clearing decient amounts of money each month, like $500 and in a few years they are getting foreclosed on. They just didnt expect the maintence budget that was needed for a rental. Most people just figured the same amount for maintence that they spent when they lived in the house. Thats just not accurate because most people that rent are animals...
 
I don't remember anything like that available on a ST deposit account. I remember Ally Bank offering an introductory rate on accounts at some point. If what you are saying is true and the average was 5.23% then there would have had to been some accounts offering 8-9% to balance out all the low ones. Still not seeing any specifics. Pull out one of your old CD's from that time and post a picture of it. Sorry but I just don't believe it.
 
(quoted from post at 09:18:21 03/08/14) Some guys at work tell me its stupid to pay off my mortgage early. I have a low 3.25 percent on a fifteen yr loan. How do u guys feel about this?
Click to expand...

You didnt post enough information to give good advice because the answer will change based on the specifics but as a general rule, never, Never, NEVER take advice from the idiots at work. I think through the years I would only take advice from about 5 people out of the many hundreds. You should probably consider this website a big lunch table and not listen to anybody but having said that, I would keep your personal home under the Dave Ramsey umbrella and pay it off. Outside of that, you can take on more risk.

The old rule was to not take advice from your peers but to seek out people who are at the level you want to be at and find out how they did it. I dont think that advice has changed.
 
depends on your age and financial situation and future borrowing plans. By paying it off, you may be better armed to NOT have to borrow in the future since you can now continue to put that payment/interest away in your OWN account. It's always better to "pay yourself" than pay someone else. Get there and stay there, you won't regret it.
 
My story: Bought my Dad out and built a new house 19 years ago. He loaned me the money for the Land/House. He charged me 6% interest, I had a big down payment too. I got behind about 12 payments during 2009-2011, work slow, bad economy, broken back, etc. I managed to get caught up later and actually paid this place off on Jan. 1, 2014. Paid it off a year early, had a 20 year note, I am 45 years old. Get rid of your debt as soon as you can. There is NO profit in paying even a small amount of interest. I sleep a lot better at night without a house payment. Don't listen to the fools telling you not to pay off. There is a lot of wisdom on this board, these older and younger men have been through a lot and have the hindsight you don't have. Johnny
 
Interest on a saving account is less than .5%. Pay it off, then take out a home equity line of credit. Where I live for tax purposed, the home equity line of credit is the same as having a mortgage. I just have to file the paper work. My home equity doesn't cost me a thing.

Then sock your money away and pay cash for your next car.

However, if you have credit card balance pay that off first. Credit card interest rates are criminal.
 
George, the gotcha with a home equity line of credit is it has a variable interest rate. So let's assume he has cash in hand to pay off his (presumably fixed rate) mortgage. Then he takes out a HELOC, and draws money to buy something shiny. No problem, he just swapped one 3 percent interest rate loan for a different 3 percent loan. Then next year, LIBOR jumps up by 3 percent. BAM! His interest rate just doubled.

Keeping a low, fixed rate loan is almost always preferable to refinancing that debt with a variable rate loan.
 
You are right. I paid off my house, got a HEL to get a tax break, never used my loan, never paid a penny in interest. Paid cash for a new car in 2005. Paid cash for new truck in 2007. Paid cash for last two rental homes in 2003. I've been out of debt for the past 15 years.

If he pays his house off, he should be putting money back to buy things. If he has car loans, credit card debt with a higher interest rate, pay them off first.
 
Where are you getting the money to pay it down? If your taking it from a 401 then you will probably be losing. The 401 should be returning more than 3.25 or your not invested right. If you have cash laying around to pay it off could it not be invested to also make more than the 3.25? Say down the road you want to put up a shed and it runs you $40,000, just to use a number. Your cash is now in the house you have paid off. You can do the home equity thing or take another loan to pay for it. Interest rates will never be this low again and you might be looking at a 6-9% loan. I once bought a house to remodel and try to resale. I paid 13% interest on that loan. My house loan rate was 9% and that was pretty much the norm for many years. Of course if you had money you could get as high as 16% in cds also.
 
I would lean towards paying it off. I generally like Dave Ramsey's advice. The key is to be conservative in the first place. There will always be someone who has a better house, or a bigger farm, or fancier toys than you do. My wife and I have been debt free for over 30 years, and I can tell you that it has been a liberating factor for us, just knowing we didn't have a monthly payment due on anything.
 
Last year the stock market was up almost 30%. Some say it will go up another 15% this year. Compare that to your 3.25% loan.
 
I never assumed that at all, and have not bought a t-note in 20 years.....and certainly wouldn"t do it now.
 
It may be low interest but it's still money going out of your pocket. Unless you can get more interest on the cash you have I would pay it off.
 
For me it is peace of mind. I have 2 yrs. left on a similar note. Built new in 2000. I plan to pay off on schedule and bank the rest. The rest will go into retirement fund and pay to restore my old tractors.

For me I seek the security & safety that comes from having no debt. Shotgun, rifle and 4WD a country boy can survive.
 
In your situation... I think one question I'd seriously ask, in addition to the other points already raised... what is your second house worth in today's real estate market vs what was it worth 6-7 years ago vs what it might be worth in 5 years from now. I'm guessing that you're probably in a rising market? So mabey outside of the direct economics of renting... mabey you can capture some capital gain by waiting a while and renting it until the value appreciates somewhat more? Just a thought anyhow...

Rod
 
I paid my mortgage off early. The really nice part is that when that is done you will have that extra money available like its almost additional income, i.e a $700 payment that is now gone and there is $700 extra income in your budget. Of course you don't have to spend it and you can save or invest it then.
 
An interest rate amortization table book is a good investment, as you can quickly figure the effect of increasing your payment. You can also do the calculations using a spreadsheet program.

According to my book, in order to knock one year off your loan, you need to increase your payment by about 5.5 percent. That assumes you have 15 years to pay on a 3.25 percent fixed interest rate loan. To knock five years of the loan, you need to increase your payments by a whopping 40 percent. If you've made a couple of years worth of payments, you need to increase your payment to get the same effect. Making small additional principal payments has a very dramatic effect on long-term or high interest rate loans, but not so much on a 15 year loan with a low rate.

I assume you have a fixed rate loan. If you by any chance have a variable rate loan, refinance it ASAP to a fixed rate mortage. Interest rates will not get any cheaper than they are today.
 
JD, that seems quite likely. If so, his problems had nothing to do with the sale of his mortgage service to a different company. He simply didn't understand the documents he signed at closing. Variable rate loans snared many unsophisticated borrowers and were a major factor in the 2008 financial collapse.
 
Debt is simple really.
You OWE somebody something.
not good in my opinion.
pay off all debt starting with the highest interest ones first.

It depends on your personal discipline too.
If you are making payments now, and pay it off...
then continue making that exact payment every month to yourself..
your nest egg will come back and grow very quickly.
after paying off debt, need credit?
buy a new truck/tractor at zero percent interest
WITH the amount of the loan backed up in your savings,
so you could pay it off anytime if need arises.

Like most, I had a lot of debt when I was younger and raising a family. Now that I'm out of debt,
if I don't have the money to back up a loan for anything....I don't need it!

UltraDog, 20 years ago, I'd say rent it.
today, with a sue happy society and rental rules that demand the property be nicer than where YOU live....sell it
 
Good points, Rod, but the tax code in the US complicates that question quite a bit. If you've lived in a home two out of the past five years, you can sell it without paying tax on capital gains. Obviously if you rent it out for five years then sell it, you'll pay capital gains. Also, rental property can be depreciated, which means significant tax savings today at the expense of greater capital gains tax in the future.
 
Dave, I don't have any old CDs to post, and if I did I'm certainly not going to post my financial documents on the 'net. If you're unwilling to accept the information published by the Federal Reserve, I doubt any amount of proof will be sufficient for you.
 
Yeah... I don't have any idea what the tax codes are there. Here, it would depend on how it's structured. My way of looking at it tho... if there's a chance of some significant price appreciation and the rental aspect is holding it's own... worst case is you pay a percentage tax on the gain. I don't know what that is nominally where he is... but here it would still be well worth doing.
Again, not knowing your tax codes.... but if you could use the depreciation to create a loss that can carry forward.... mabey you pay less tax on the capital gain than on the earned income? I dunno... just tossing out ideas.

Rod
 
I paid my mortgage off early and now my escrow fund for taxes and insurance is only $340.00 per month.
Dont forget to calculate this, as it was included in your original mortgage payment.
 
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