HELOC vs. Cash-out Refinance...or both

[Joshua Merchant]

My wife and I have just started our real estate journey and, after months of looking, closed on our first property in upstate NY in December. We're 90% through renovations which bring the house from $88k to $135k (based on bank's loan and renovation assessment). We also have a primary home in VA that has appreciated a good bit in the past 1.5 years. We live in a new build and the similar houses in the sister neighborhood have been selling for a significant amount more. We refinanced last year and lowered the monthly payment so I have an assessment from the lender.

I've begun looking for the next deal, but have been weighing options on how to finance it. I think I could pull a HELOC move and get ~$70k out or we could cash out refi on our rental in a few months. Even if we get a higher interest rate my calculations still show us with $250 positive cash flow each month. With rates on the rise and the market as it is I'm not sure if one option is "better", but thought I'd reach out to the community and get some advice.

[Karen Filipponi]

Hi Joshua - My husband and I have several rentals and the experience of rehabbing.  We’re looking into multi-units and a possible flip this year. We live in the Stafford area so perhaps we can connect in the coming weeks?

Cheers, Karen and Rick