Is this my best move to start BRRRR?

[Nic Juncos]

I've presented my scenario before but now I've got a little more knowledge under my belt.

1) The house I live in is owned free and clear. Will appraise around $100K (Paid $30K originally)

2) We want to move to a nicer place around $150K and use an FHA loan for a 3.5% down payment.

3) We want to rent out first house and hoping to get around $900-950/month.

4) We want to purchase another home to BRRRR.

Would it make sense to do a cash out refi on current home now to get around $75K for our endeavors??

1) Pays for 3.5% down payment on new home.

2) The refi loan is covered with the first house rental income netting around $250/month cash flow.

3) Cash leftover from down payment of new home gives roughly $60K+ to pay cash for BRRRR property.

Is there a better strategy to achieve what I am wanting here??

Thanks for any input/feedback!!

[Mason Hickman]

@Nic Juncos

As I’m sure you’ve ready many times on here: it all depends on your goals.... here are a few thoughts to consider:

If you’re going to want to take the money out of the first property at any point in the future, do it now while you live there so you’ll get lower interest rates.

With a cash out refinance, will you have any trouble getting another loan?

Do you need the cash from the first property to buy and renovate your second property?