Some investors want to repay rental properties as rapidly as doable as a result of after the property is paid off, they’ll have additional cash circulate, which they can use as earnings or to make repairs on the property or to buy extra properties. But if you need extra free cash every month now, or for those who need additional flexibility with payments, or if you want to have cash available to purchase different properties, then selecting an extended-time period mortgage could be the smarter transfer. At that time, you’ll have maybe $1,500 monthly in rent (or $18,000 per 12 months, which seems reasonable given inflation). Sounds good, however you’ll nonetheless have real estate taxes and insurance to pay, plus repairs and upkeep, and you’ll have your cash tied up within the equity of the property. An escrow or an escrow account is the money that’s collected by a lender that is used to pay your real estate taxes and insurance, however don’t worry.