I have a small rental house that is paid for worth approx 50k. I would like to buy a camper so my family can do some camping this fall. What are my options on refinancing or borrowing money against this house to buy a camper? I don't need a complete refinance just enough to buy a camper, what should I do?
2007-10-06 13:44:14 · 5 answers · asked by classic_stump 1 in Business & Finance ➔ Renting & Real Estate
Think about this, why to you want to "own" a camper. If you are only going to use it for a few weeks, why not just rent it?
I also don't know what kind of rv you can get for less than 50k. All the ones I see in FL are a lot more than that. It sounds like you were looking at something small. If you just rent the RV, you will be able to get a nicer one than you can buy.
Personally, I would not do a refie just to buy a "toy" only more real estate.
Rent your rv, boats, convertabiles, and all the other nice things in life.
Best wishes
Joe
2007-10-06 13:58:09 · answer #1 · answered by Joseph G 6 · 0⤊ 0⤋
There's not enough information to determine if you SHOULD refinance. You have to consider your overall financial picture: can you make the payments, what other debts do you have, what happens if the rent you get has to be used to make the payments rather than for other living expenses?
But it is possible to get a cash out refinance of a rental property.
You can get a cash out first mortgage. Even though you don't have a mortgage now, it's still called a refinance. Since it's rental property, because you only need a small amount of cash (small in the grand scheme of things) and because it will be all cash out, you can expect the rate to be a bit high. Also consider the closing costs. If there's enough equity, you can finance them into the loan in most cases. If you go over 80% loan-to-value, you'll have to pay for mortgage insurance. Weigh all that against how important it is for you to get the camper. There are fixed rate and adjustable rate loans, but right now the ARMs are too high to be attractive.
You might be able to get an equity loan -- like a home equity loan, but it's not your home. Usually the rates are higher than a 1st mtg, but many of them don't have closing costs, that is to say, the borrower doesn't pay any closing costs. These are generally fixed rate loans.
Third option is a line of credit. It's like a home equity loan, but instead of handing you a check for $50,000 at closing (no 3 day waiting period since it's not your residence) but give you a line of credit for $50k. You only pay interest on what you use, and as you pay it back it's available to borrow again. It's kind of like a credit card in that. The rate tends to be variable, changing every month, again like a credit card.
I would suggest you call your bank and ask them about the options they would have. If your bank doesn't offer cash out on rental property, try a big bank like Bank of America, or even a credit union you're eligible to join.
2007-10-06 14:03:16 · answer #2 · answered by Debdeb 7 · 0⤊ 0⤋
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2016-07-18 18:23:53 · answer #3 · answered by ? 3 · 0⤊ 0⤋
I would keep your title clear to the house. There are too many possible complications and pitfalls when you put leans on a mortgage. I would wait for the right time when you have some money and rates are low and you are getting a steal on the camper! If you keep your eyes open and have patience I think you will find your reward in this way. I think at the right time an independent loan would be your best bet. At my age I have seen it all and this would be my vote. Good Luck!
2007-10-06 13:57:13 · answer #4 · answered by Wayne W 2 · 0⤊ 0⤋
Rent-To-Own Home : http://RentToOwnHome.uzaev.com/?kqeq
2016-07-12 10:33:19 · answer #5 · answered by Anonymous · 0⤊ 0⤋