Should I sell my House?

[Louis Bratton]

Hi BP,

I currently own a home that was originally purchased using VA Loan in 2006 for $219,000 and could sale at retail for about $280,000 now. This is considered a Class A Neighborhood where all of the new construction starts at 400k+ now (Cary NC). I bought it with the intentions of renting it out after i moved out in the future. It could currently rent for about 1600-1700 a month which is less than the 1% rule but would leave about a $300-$400 spread after paying mortagage. I have other rentals currently. I am interested in buying a new personal home next year around January so if I sale it I could use my VA loan again, but if I keep it I could just use FHA since I have never used one. Looking for advice. Would you sell or keep it?

[Tracy Sharpe]

Hello Louis, I am a beginner whom has made some mistakes. I am retired military. I have used my VA but sold the property so I now have it available.

In any case, my biggest mistake was when I took equity out of my residence to buy a bigger and more expensive house. At the time, I didn't need to because I didn't have to move. I was just wanting something bigger, better and something to say to myself that I was moving up. Although I was moving up, a wiser move would have been for me to stay in that house rather than renting it, take equity out of the house, buy a rental house and rent it for passive income. All I did was buy a bigger house with a higher mortgage and payment which resulted in more debt.
Unfortunately, the housing bubble popped and I found myself upside down in a loan. At the time, I was living in Northern California.

Depending on your situation, your goals, and your reasoning for buying a new house consider your alternatives wisely. I hope that sharing my mistake will help you in making your decision.

Nice to know that you are doing well. God bless, Tracy Sharpe