1. If the numbers he is presenting are correct, then he’s got a negative cash flow even with a low mortgage balance relative to the value of the property. He’s not charging enough rent.
2. Why would he refinance at an higher rate AND take another $100,000 out of the equity if this move put him in a cash flow crunch that is a problem for him?
I have questioned the authenticity of many of the letters to Marketwatch. People describe outlandish scenarios, and ask the most foolish questions.