Posted by Jay(TN) on July 28, 2003 at 20:20:54:
If you plan to buy more properties, keep the ARM and use the LOC for new purchases. I recently bought a property with cash and part of a LOC. I later found more deals, and now I need the cash sunk into the other property. Keep the cash or LOC in your back pocket. 5.875% is a great rate, historically speaking.
Also, think about your interest rate. If you acquired another investment, can your net return exceed 5.875%? I bet so. Use your LOC to acquire new investments.
Basically, what I’m trying to say is there are better uses for that LOC, and paying off the 30 year ARM probably isn’t one. If you’re winding down for retirement, then your priorities may change.