Newbie needs help to start please!!

[Mai Holmquist]

Hi everyone! My name is Mai Holmquist. I'm from Fresno, CA. My husband and I own a home that we both live in for a couple years now. I want to use the equity of the house to help jump start my investing. Should I refinance the house or pull out an equity loan? 

[Aleks Gifford]

Legal stuff first: I am a licensed Sr. Loan Originator NMLS# 1157855 and am currently licensed to originate in IN, OH, FL. If you are not in those states what I say may or may not apply to you. Please consult an advisor in your state. That being said when comparing a fixed rate first versus a second you should consider several factors. Is the second a line or loan? Do you need rinse and repeat functions? Is the interest rate fixed or variable? Investing against your primary home is a risky strategy and should be a last resort. When advising my borrowers I suggest they simply refinance unless they can secure an equity loan. You need to work your math on the total cost of the loan including closing costs, rate and APR. You need to consider how long you are keeping the primary home and the home you are buying. If you are flipping it would be a different conversation that if you are buying a rental. Further more it each of those has its own calculations you would need to do.

In short with the information provided it sounds to me like you are asking this question with out having an investment plan and strategy in place, nor have you completed cost analysis of the options and finally you have not sat down with professional advisers who can help you go over the numbers.

Rule number on of investing in anything is due your research after you have worked a plan backwords from your goals. You do this so you do not steer your research to a predetermined conclusion.