Consensus on mortgage renewal: pay down balance and renew, or renew as is?

[ExtraSlow]

No comment Or insight into investment properties. You'd better be a sophisticated and disciplined investor to have those, and very few people actually are.

If you want to invest in RE, buy a REIT.

[Xtrema]

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so, to piggy back off this, is it advisable to pay off the mortgage on a income property? we can write off the mortgage insterest so i assume that's still best to pay it as slow as possible.

Depends on your cashflow. As rate drop and people buying again, renter pool will shrink and rent will drop.

Paying it off will give you a bit of room to compete for renters if it comes to that. I don't see if for 2024 tho, may be 2025.

[ercchry]

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No comment Or insight into investment properties. You'd better be a sophisticated and disciplined investor to have those, and very few people actually are.

If you want to invest in RE, buy a REIT.

Fuck REITs, MICs are the way:

[ExtraSlow]

I don't invest in real estate at all. What's an MIC?

[Xtrema]

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Fuck REITs, MICs are the way:

Yeah, I wonder why they didn't show 2008...

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I don't invest in real estate at all. What's an MIC?

I assume Mortgage Investment Corp.

[ercchry]

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Yeah, I wonder why they didn't show 2008...



I assume Mortgage Investment Corp.

Well… it’s Canadian real estate (BC, AB, ON) so 2008 was probably fine. But 2008 was a completely different company as well (and a fraction of the size, currently $1b AUM).

Yes mortgage investment corp… RRSP eligible too

[pheoxs]

How does a mortgage company get 9% returns for years when rates were only a few percent? Are they issuing some sort of low credit super high rate mortgages?

[ercchry]

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How does a mortgage company get 9% returns for years when rates were only a few percent? Are they issuing some sort of low credit super high rate mortgages?

Yes, MICs traditionally are the respectable side of “private” lenders. They also leverage a line of credit to some extent. Origination fees + face rate is typically much higher than prime lenders… but also some times it’s not. Depending on LTV this money can be cheaper for an open term than a big bank’s open term.

Usually if it’s a poor credit situation, the loans will be really low LTV, most people that take these loans are actually decent with money, but just need a stop gap due to their current situation (either own too many properties, doing something in the investment space of RE, or don’t have that 2yr claimed NOA income business owners need with banks)

[riander5]

A good rule of thumb is if your interest rate is above say 5%, pay down debt. If it is between 3-5% use your discretion, If it is below 3%, pay debt off slowly and invest your surplus.

We are deep in the 'pay off debt' range now.

Got this from my fav investing book that i wish i had at 25 - 'The Simple Path to Wealth'

[suntan]

'bout 3 fiddy