[Lnc-business] Added Mortgage Payment

[Tim Hagan]

I will call your $150,000 and raise it to $207,500. I request we add 20 minutes to the December meeting agenda for a motion to make a payment on the principal on our office mortgage.

The mortgage's loan rate is 4.85% with a balloon payment at ten years, which is in July 24, 2024. Robert was kind enough to furnish the attached load amortization spreadsheet. I ran five scenarios on it to get the amount of interest we will pay from December 2016 to when the balloon payment is due, and to get the amount of the balloon payment that will be due at that time.

Without any more prepayments (not paying an extra $60,000 on odd-numbered years):
Interest: $139,400.40
Balloon payment due 7/24/2024: $301,040.34

With the current policy of paying an extra $60,000 on odd-numbered years:
Interest: $84,900.77
Balloon payment due 7/24/2024: $6,540.71

Paying an additional $207,500 in the December payment, and not paying extra in future years:
Interest: $45,751.59
Balloon payment due 7/24/2024: $0.00

Paying an additional $150,00 in the December payment, and paying an extra $60,000 on odd-numbered years:
Interest: $32,805.22
Mortgage gets paid off July 2021.

Paying an additional $207,500 in the December payment, and paying an extra $60,000 on odd-numbered years:
Interest: $19,879.20
Mortgage gets paid off May 2020.

As you can see, paying $207,500 in December will eliminate having a balloon payment in 2024 and will save at least $39k in interest. If we keep the Weiner rule, it will save $65k in interest and have the mortgage paid off four years early. The targeted Reserve is the sum of all monthly occupancy, labor and governance expenses, which comes to $45,292. At the end of October, the reserve was at $415,669, so I am comfortable with paying $207,500, even if next year's budget has a large deficit. We will have new reserve number before the meeting.

The trust from a bequest has $167,404. We have been taking the maximum allowable amount out each year for the general fund. A law passed December 2014 now allows national political committees to have a separate segregated building fund with its own contribution limit of three times the limit for the general fund. We have not done this before, because we needed the bequest for the general fund, but we can transfer up to $100,200 from the bequest to the building fund and use those funds toward making a payment on the mortgage principal.

My preference is to pay at least $207,500 toward the mortgage principal to save on interest payments and to ensure no balloon payment. If that passes, then I would favor reducing the policy to budget an extra $60k on odd years.

Tim Hagan

      From: Sam Goldstein <goldsteinatlarge at gmail.com>
 To: lnc-business at hq.lp.org 
 Sent: Sunday, November 27, 2016 8:11 AM
 Subject: [Lnc-business] Added Mortgage Payment
   
I intend to make a motion at our next meeting to spend a good portion of our 2016 surplus to make a payment on the principal on our office mortgage.  
Not knowing our final numbers at this time lends some uncertainty to that number, but I would like to start the bidding at $150,000.  That amount ought to leave us in a very favorable position as to our ongoing reserve for unforeseen expenses over the next few years.
Does anyone want to offer a lower/higher amount?  If so, what is your reasoning.
Thanks and 
Live Free,

 
Sam GoldsteinLibertarian National CommitteeMember at Large8925 N Meridian St, Ste 101Indianapolis IN 46260317-850-0726 Phone317-582-1773 Fax
_______________________________________________
Lnc-business mailing list
Lnc-business at hq.lp.org
http://hq.lp.org/mailman/listinfo/lnc-business_hq.lp.org


   
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://hq.lp.org/pipermail/lnc-business/attachments/20161127/1a897031/attachment-0002.html>
-------------- next part --------------
A non-text attachment was scrubbed...
Name: Loan Amortization1.xls
Type: application/vnd.ms-excel
Size: 156672 bytes
Desc: not available
URL: <http://hq.lp.org/pipermail/lnc-business/attachments/20161127/1a897031/attachment-0002.xls>