- Joined
- Dec 27, 2007
- Messages
- 29
Hello,
What would you do in this situation:
my friend bought a home in Eastern Ontario for before the current slow down. his work transfered him to work in another city where he currently lives with his parents. He is leasing the house he purchased and is making a net loss of approx $200 monthly after principal, interest, insurance. His amortization is 20 yrs. The mortgage is open variable and I don`t think the bank knows that it is currently being leased as opposed to lived in by him. In your opinion is there potentially a problem if he were to try and re-amortize his mortgage to 25 or 30 yrs. in order to have positive cash flow. A real estate agent told him that if he were to go to the bank and tell them his situation, they would demand a sum of 25% of the mortgage value b/c this is the required downpayment for rentals. Any advice is greatly appreciated.
Thanks, Marty.
What would you do in this situation:
my friend bought a home in Eastern Ontario for before the current slow down. his work transfered him to work in another city where he currently lives with his parents. He is leasing the house he purchased and is making a net loss of approx $200 monthly after principal, interest, insurance. His amortization is 20 yrs. The mortgage is open variable and I don`t think the bank knows that it is currently being leased as opposed to lived in by him. In your opinion is there potentially a problem if he were to try and re-amortize his mortgage to 25 or 30 yrs. in order to have positive cash flow. A real estate agent told him that if he were to go to the bank and tell them his situation, they would demand a sum of 25% of the mortgage value b/c this is the required downpayment for rentals. Any advice is greatly appreciated.
Thanks, Marty.