Refinancing & Buying 2nd Property

[Sarah Hoffer]

Hello BP Family! 

I currently own a SFH in Phoenix that I have been house hacking for 1 year. I recently got a job in North Carolina, and I would like to refinance my home to pull out cash to help support purchasing a 2nd property to house hack in NC. If I refinance before I move, are there implications if I will no longer be living in the property, and will I have a harder time purchasing another property in NC due to my recent refinance?

This is my first time refinancing, and I want to ensure I am doing everything above board and not hurting my chances of buying a 2nd property. 

I appreciate any insight and assistance you can provide! 

Thank you, 

Sarah

[Pat Lulewicz]

If your DTI can support it and you have the equity to make it work, consider taking a HELOC on your primary to use a downpayment for NC instead of refi. I live in Raleigh, NC and my home appreciated astronomically over the last 18 months. My original lender let me take a HELOC for 90% LTV. The HELOC is a 30-yr fixed w/ no prepayment penalty at 3.5%. Worst than gov't backed loan, but better than investor loans. I will also be moving out of this home to rent it (similar to your strategy) so pulled the HELOC before I moved out. None of the loan docs require me to stay in it after I met the 12 month live-in requirement of the original loan/purchase.

When you look to buy in NC, only caveat for your next purchase on the lending side will be that you get your Phoenix home rented out to cover your mortgage. That way, your DTI won't be impacted by the Phoenix mortgage. Any time you're trying to get a gov't backed loan, your mortgage originator can count 75% of the rent for the Phoenix house against the Phoenix mortgage so would be good to get rent 33% higher than your Phoenix mortgage so that NONE of that mortgage payment counts against you in underwriting.

Where in NC are you moving to?