Suggestion needed on buying a property

[Aariff Kadar]

I own a home (primary residence) in Corona, California and i am planning to buy another house in another expensive area (Irvine, CA) which is close to work place because i am spending 2 hours in traffic everyday.

My current residence is in 15 years mortgage and paying $3000 as monthly mortgage plus tax and insurance. I have almost 300K equity on it.

I have come up with few options and i have listed below. I am in dilemma on which one will be good for me.

If  i rent my current residence, it does not give positive cash flow because i am on 15 years mortgage and i end up paying Tax and Insurance after mortgage payment from rent.

1. Borrow money from 401K and buy new primary residence with 10% down (i need to pay back 401K in 5 years)

2. Rent a house in the new area, Rents are expensive in Irvine, CA. 900 - 1000 sqft apts rent for $2500, my corona home will rent for $3000.

3. Sell my corona house and make 250K to 300K down for new house in irvine

4. Save some money for 10% down and buy house in irvine, CA

5. Cashdown refinance my current property to 30 years loan, which will make my mortgage as $1900 plus tax and insurance. I am hoping $200 to $400 postive cashflow

Which option will you suggest for me to move ahead. I am planning to take action during next summer.

[Brenda E.]

What about refinancing Corona to a 30 year mortgage, pulling out $100-150K equity and use that to put down on a place in Irvine? With the extra time, even with the $100K pulled out, you're payments would drop and you could cover Corona (with taxes and ins. included) and have a smaller payment in Irvine.  Then when you are done, pick where you want to live (probably Corona), sell the other for top dollar, pay it off, and slap the extra on to the other and refinance again if you need to.