Can I put the profit from my rental house sale into the mortgage payment for my house that is now for rent?
Answers | 2
Hey Kirt, I might need a bit more clarification where your question is concerned...but first let me say this. You can ultimately do anything you want with the proceeds from a sale of a property.. What is it exactly are you trying to accomplish - minimize taxation, more efficient use of your dollars or are you eluding to a 1035 exchange?
Agreed that some more details would be helpful. If you're talking about making a lump sum payment on a current mortgage, the answer is "depends". Some banks (including my employer) allow borrowers to make lump sum payments, then recalculate the mortgage payment based on the remaining principle balance. It's called a "recast" and is far simpler than going through the refinance process. Lenders who don't allow recasts will all take an additional principle payment, but in those cases the payment simply reduces the remaining term of the loan, rather than lowering the monthly payment. Hope that helps, Ted