Recently Refinanced Borrower Uses Rental Income to Pay Off Loan in less than Three Years

This borrower originally reached out only to refinance a current owner-occupied property with substantial equity. They had refinanced their new loan only two months prior. After the appraisal, we determined we could capture a new line amount of $1.5 million, letting the borrower not only pay off the current lien on the property, but also pay off a second home — all with the All-in-One loan. In addition, the borrower also owns a commercial rental building. By depositing the rental income into an All-in-One Loan account and withdrawing funds needed to run the building, the borrower could put the All-in-One into turbo mode. They were able to pay off the loan in less than three years with no loss of liquidity.

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Compare the interest savings the All-in-One affords over current loans on this property.

The Effective Rate is the rate you would have to obtain with a 30-year fixed rate mortgage in order to pay the same amount of interest you achieve with the All-in-One Loan. The Breakeven Interest Rate is the rate you would have to average in order to pay the same amount of interest as the current liens on the property.

Remember, the maximum rate the All-in-One Loan can adjust during its 30-year term is 6% above the start rate — making this borrower's maximum rate 9.261%. Therefore, this borrower will come out ahead no matter where the interest rates move through the life of the All-in-One Loan.

This is the comparison loan data — it includes both lien types which comprise the client's current loan on the property.

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