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Running scenarios on rental income, stress test was wrong

February 19th, 2018 at 11:10 pm

Hi all

I figured out finally why my stress test looked so low. (been a stressful few months.. must have gotten mixed up). I multiplied my total rental income by 30% instead of 70% to get a rental income with 30% vacancy (dooh!!)

Anyway here is where I am with vacancy at 33% and current costs.

I check every year if I can cut utility costs and food and misc. I will check that now. I generally do not run credit card debt but have some now w the 2 flat. Also should be able to reduce health insurance

Intersting to run #s. Final punch list for my 2 flat happening now. Have some good interest on that vacant house..

The scenario below does not change my plan to work ALL of this year.. With that said I still expect to be working and putting all funds through August to pay off the 2 flat debt (home equity, $16k) and 40k I took from other accounts) down so I only the seller financed mortgage..currently standing at approx $18981 but going down approx $1000 a month... by August this seller financed mortgage will be approx $12k. The seller financed mortgage pays itself off June 2019 with regular payments.

My mortgage (over $3k, 15 year loan) makes up the bulk of my monthly costs. I am no longer looking at refinancing but might be open to moving if the opportunity makes sense and the housing cost is LESS than what this would sell for. Need to move while I have high income. I have $205k equity approx in the house.

Of course if I sell the 2 flat all the 2 flat debt will be wiped and I will cash to invest. The plan is to rent it immediately and decide on selling it based on the market in April

It will be so nice to lay off having to payoff so much every month and thsi crazy treadmill. I can sortof feel myself semi relaxing now and starting to give a little and 'enjoy' a little bit without being so stressed with money, costs etc

It would be fun to start some small business again doing something I enjoy (part time) and NOT NOW. I know I have way too much going on w school. But that not for profit I found netted me I think a little over $30k.. (gross) and was part time and fun (for a while)

I look to get over $2MM net worth by the end of this year unless we have some MAJOR MAJOR crash in markets.

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