September 2012 Debt Snapshot

Here is another update on our debt. I've been looking at this over the past year as I'm primarily interested in improving our cash flow. I don't see paying down our mortgage debt as the best return on our money, but I do see improving our cash flow critical for maximum flexibility for future opportunities or dealing with unexpected income loss.

I recently made a move to transfer a higher fixed APR mortgage balance to a variable apr equity line to reduce my carrying costs.

Here is what our mortgage balances looked like in July:

Loan	Description	Property	Balance	Payment	Matures
1	5.6% 30yr fixed	House #1	$41,747	$1,031	Aug-31
2	HELOC @ 3.25% var.	House #1	$25,890	$75	Aug-23
3	IELOC @ 4.25% var.	House #2	$7,726	$100	Jul-29
4	4.375% 30 yr fixed	House #3	$248,116	$1,508	Sep-40
5	5.0% 30 yr fixed	House #4	$120,753	$996	Sep-41
		Total	$444,232	$3,710

After the transfer of Loan #1's balance to Loan #3 in August/September:

Loan	Description	Property	Balance	Payment	Matures
1	5.6% 30yr fixed	House #1	$0	$0	Done
2	HELOC @ 3.25% var.	House #1	$25,787	$75	Aug-23
3	IELOC @ 4.25% var.	House #2	$46,452	$564	Jul-29
4	4.375% 30 yr fixed	House #3	$247,367	$1,508	Sep-40
5	5.0% 30 yr fixed	House #4	$120,466	$996	Sep-41
		Total	$440,072	$3,143

The main benefit here is the minimum cash flow required has been reduced from $3,710/month to $3,143/month. Keep in mind there was an escrow payment included in Loan #1 (and not in Loan #2) of ~$300/mo so technically I should be putting that away myself and our minimum cash flow would be reduced by about $270/month.

That is nearly a 10% minimum cash flow reduction and about $50/month saved in interest on our current balance. Small steps, but further progress in improving our cash flow.

Im also keeping a close eye on rates and considering refinancing Loans #4 & #5 if there would be a clear payback in doing so.

Related in Real Estate:

No Closing Cost Loan Example (Nov 29, 2012) I've gotten multiple requests to clarify the recent no closing cost refinance loan I just completed. Its a bit of a vague term and could be done different ways, but the end result is that there are no out of...

3.5% 30 Year Fixed No Closing Cost Refinance (Nov 27, 2012) We finally closed this week on our 3.5% 30 year fixed refinance with no closing costs (no closing costs = a credit from lender/broker large enough to offset refinance costs). It took us over 2 months (67 days from initial...

Appraisal Appeal Unsuccessful (Nov 05, 2012) Not much of a surprise, the appraiser dug in and didn't budge after we submitted our appraisal appeal: Our more favorable comparables were based on county property records. Interestingly the appraiser indicated the MLS data is generally considered more accurate...