Mortgage questions when dollar collapses
So I have a too big mortgage 740K and want to sell but my SO is dead set against it. We still have 35 years on the mortgage. The property is a triplex and 2 of the rentals pay the mortgage. So the net effect now is we dont pay to live in it.
We plan to move offshore and rent it all out which will bring in a postive cash flow that would support most places we are thinking of living. BUTTTT
in the event of a dollar collapse, i would expect any positive cash flow would be useless out of the US and should be put toward principle to pay down the mortgage??
Is my thought process close about a dollar collapse meaning our “rental surplus” would lose any real value and the best bet at that point would be to give the useless fiat money back to the banks who issued it in the first place?
Thanks for any insights…
Some one said a few years ago that the dollar was the least bad of the fiat currencies. I feel that if the dollar valuation moves quickly, there will not be a fiat worth the paper it is printed on. Having said that, I think that we are most likely to see a slow collapse (AKA catabolic collapse from JM Greer) unless there is a war or some equally catastrophic event.
The rental surplus should be able to pay off the mortgage, and should be able to provide for the increased taxes and maintenance costs, higher utilities that will only increase going forward. Until the end of the world as we know it, (which night happen any day now) your triplex, in my opinion, should continue to return enough to pay for itself and a bit more.
Saying that, like Chris, I believe everyone should have a diversified base. Hard, transportable assets should have a role in our portfolio.
I agree with Dude about U.S. Fiat being less bad. Depending where you offshore, you may be jumping from the frying pan to the fire. I'm not trying to politicize the issue here, but no matter where you go, someone who doesn't care anything about laws, will be armed and dangerous in your area, even if they just have machete. Being able to defend yourself becomes very important in collapse situation. If you are going to be with a group, numbers help, but once again an armed thug can control a whole lot of unarmed people. Depending on where you live in the U.S. you may be able to level that field, if you stay. Just a thought here.
As for your mortgage, though. If you think you could sustain the rent level you currently have after a collapse, then keeping it may be a good way to go. If it were me, I would look and see how much equity I have in the place today and decide if I wanted that equity for something else. At 35 years left, I'm guessing you don't have a lot of equity unless the property has appreciated significantly since you bought it. Also you need to think about whether all three units could stay rented while you were being an absentee landlord. In my area $800 U.S. would be moderate rent to pay on "decent" place to live. Decent is a safe neighborhood, with the unit in good repair, or some type system to get thing repaired in a timely manner. $1200 is about the norm for the above requirements. I wouldn't live in my sons duplex $850 a month for example, because of safety issues, but I would his house. $1650 is on the high side, but is common around here.
Hope this helps.