taking out equity and renting

[Felix L Perez]

Hey guys! 

this is my first official blog post even though I've been reading blog posts and listening to podcasts for almost a year now! 

So I had a question, I recently had a family member pass and in their will they've left me their house. it's a $75,000 home however my parents won't allow me to sell it because all of our families houses are next to each other and they want to keep it that way but they are willing to let me rent it. 

what I would like to do is take out 80% of the equity on the home (we own the home outright) and start a mortgage on the home. take that equity of around $60k and put it towards a down payment on another home to rent out aswell. the mortgage on the first home should be around $450 so we would rent the home for $600 for steady cash flow on the home while putting the equity to good use. 

my question is would you agree that this is the right way to go or are there other solutions you can think of? also what steps would I have to take to take out the equity? is it as simple as going to a mortgage broker or is it much more complicated than that? any suggestions or comments would be very helpful. thanks!