How to Model Mortgage Payoff following Sale of Rental Property
Rental property A (single family home) that has zero mortgage balance.
Rental property B (single family home) that has a current $80K mortgage balance.
Primary residence property C that has a current $150K mortgage balance.
I have created a profile that shows a sale of Rental Property A in 2020 in which I continue to make continuing normal mortgage payments on properties B and C.
I want to see economic impact of using proceeds from sale of Property A to make lump sum payoff in 2020 of mortgage for property B, property C, or both.
1. How do I do that for property B Rental Property?
2. How do I do that for property C Primary Residence?
Sun, 08/25/2019 - 22:36
There's not a simple field
There's not a simple field for "pay off mortgage" in 2020. (this feature has been added to the primary home in MaxiFi). So given that the sale is 2020, rather quickly here, I would try to show a two-mortgage on B or C or both. The funds will not be available until 2020 when you sell the A property. So that may create some liquidity constraint in 2019 but it may be close enough if you have the liquidity.
Otherwise, I think you'd have to remove the mortgages from the B property and use special expenses to represent that mortgage in 2019-20, including the payoff of that mortgage in 2020. The primary property can be sold and repurchased at 100% downpayment to respresent that payoff. (be sure to set real estate commission on sales to 0% in Settings).
So you either just pay it (them) off in 2 years per your mortgage set up, or use special expenses/receipts to represent these transactions.