Author Topic: Question About Selling A Rental Property  (Read 1269 times)


  • 5 O'Clock Shadow
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Question About Selling A Rental Property
« on: December 09, 2016, 01:20:47 PM »
I currently own a condo that I rent out.  Bought it in 2007, market tanked, hasn't recovered.  Current interest rate is 4.25%.  I hope to sell it in the next two years because it's not generating any revenue.  I essentially break even each month.  My question is this.  Current value of the property is about $170K.  I owe about $188K on it.  If I pay the regular monthly payment for the next 2 years I'll have about $175K left on the loan.  If I sold at that point I'd actually owe $5K plus the money to the realtor.  I really don't like the idea of handing over what would probably amount to $15K.  Is there any benefit to me, other than psychological, of paying down more each month and say selling in 2 years with about $150K left on the loan?  I know the tradeoffs are that I could take that extra money I'm putting towards the loan and put it in the market but there is no guarantee the market will do better especially in such a short time frame.  Already max out my 401K, IRA, primary residence is paid off, etc.  Any financial benefit at all of paying it down to less than I owe?  Any downside?


  • Handlebar Stache
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Re: Question About Selling A Rental Property
« Reply #1 on: December 09, 2016, 02:56:39 PM »
I don't think so. If I understand your question, it's really about paying off the part of the mortgage "not covered by equity in property" at time of sale... or in little chunks before then. Either way, you come out of pocket.

But maybe someone else will see another angle I'm missing...


  • Pencil Stache
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Re: Question About Selling A Rental Property
« Reply #2 on: December 10, 2016, 08:07:15 AM »
no benefit to wait at all. you will also have recapture of depreciation thrown in for another 2 years so better to sell sooner rather than later. Sucks


  • Bristles
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Re: Question About Selling A Rental Property
« Reply #3 on: December 23, 2016, 12:53:15 PM »
The advantage is you get 4.25% on the money that you pay off the mortgage with.  Guaranteed.