Ask Madison: Reader Mail Volume 4

Posted by Madison on June 9, 2011

It’s been awhile since I answered reader mail, opting instead to send personal emails when I can. However, some of the emails would probably benefit others. While I was on vacation, I skimmed through some of the recent emails; here are a couple reader questions that might be of interest to readers:

Very interested in your credit card arbitrage. Would like to know how I could use this for “refinancing” a current rental property I have. The property has a remaining mortgage of $22,500 at 7.5%. I purchased it about 8 years ago. If I am able to use a credit card transfer offer for the full amount, am I able to use the interest charged, as mortgage interest for the rental, considering I will no longer receive a 1099? – Kim

If you are using interest paid for a rental, and it doesn’t come from a bank in the form of a traditional mortgage, there is a second line on the Schedule E (line 13) where you can report “other interest” for mortgage interest that is not from a financial institution or did not send a 1098. That’s where I report the cost when financing properties with credit cards. Just make sure to keep good documentation of the money trail!

On #7, how much is the modification fee? What kind of mortgage do you have in order to get 3.375%? – Chris [Referring to #7: Modify your mortgage in 16 Ways to Lower Your Housing Costs]

I’ve done two modifications, once I paid 0.5% of the outstanding balance, the most recent time I paid 1.0%. I have the 5/5 Penfed ARM. Also, I modified on a day when the buydown for the 3.375 rate was .125 points; today, the rate is 3.25% with 0 points!

Now, onto the personal finance articles of the week…

Retirement

Investing

By the Numbers

And More!




You can get my latest articles full of valuable tips and other information delivered directly to your email for free simply by entering your email address below. Your address will never be sold or used for spam and you can unsubscribe at any time.

Email:

Print Print   |  Email Email   |   Comments?

Comments are closed.


Previous article: «
Next article: »