Homeowners who refinanced their mortgages with a 3% rate are now becoming accidental landlords. Get the full scoop in this article!

Homeowners who refinanced their mortgages this year to take advantage of ultra-low interest rates are becoming "accidental landlords," with some opting to rent out their homes rather than sell them. In this article, we'll explore why they're taking this route, the costs associated with it, and what advice you should consider if you're considering doing the same.

Understand the Risks and Responsibilities of Becoming a Landlord

Becoming a landlord involves more responsibility and potential risk than simply owning your own home. It's important to do your due diligence before renting out your property, as becoming a landlord comes with financial, legal, and emotional responsibilities. Before renting out your property, you should familiarize yourself with local rental laws, calculate the costs associated with being a landlord (such as maintenance fees), and make sure you have adequate insurance coverage.

Consider Leasing vs. Selling

If you refinanced your mortgage with a 3% rate and find yourself becoming an accidental landlord, you'll want to consider all of the costs associated with leasing. This includes monthly rent, tenant placement fees, repairs, ongoing maintenance costs, legal fees, and insurance. Additionally, depending on local tax laws you may also incur capital gains taxes when leasing instead of selling. Consider all of these potential costs before making any decisions about renting out your property.

Buying an investment property is equal parts daunting and exciting. In fact, your first investment property can feel like a real roller coaster of emotions. Like with all things, there will be a learning curve to walk through, but these 4 simple steps can help to ensure that you are on the right course as you journey ahead into this thrilling new time in your life...

Prepare for interest rates and down payment. They will be different from what you are used to.

Investment properties work much differently than an owner-occupied home. You should expect to make a down payment of at least 20%. Likewise, your interest rates will be different than your home interest rates as well. For this reason, you will want to research the interest rates for investment properties.

Decide if you want to flip or rent.