Green behind the ears but already building portfolio... questions

[Evan Oxenhandler]

My wife and I have been slowly but surely acquiring some properties over the past several years. And I'll be the first to tell you we have next to no real education on the matter. We just kind of picked up the places here and there either through knowing the right person or just being in the right place at the right time.

It's been just recently that I decided that I wanted this to be a major source of income for us and so I've dedicated myself to getting a proper education on the topic (any advice for further reading is greatly appreciated. Already been through Rich dad..., Brandon's book, and a few others.) So bear with me and please excuse any questions or lack of knowledge that seem like I should know the answers to already.

We currently have about 7 properties.  Two commercial (four tenants total) and 5 res (5 tenants total) with a total value around $1M. Plus our house we live in. Our monthly cash flow after expenses and maintenance (and there are a lot of those) is around $5-6k. That all goes straight in to savings and toward whatever next prop we want to buy. We currently have no loans outstanding on any of the props.

What I think we should do next is consolidate these props and use the money we could get from selling them all as a down payment for a much larger, perhaps multi unit apartment complex. That way, we'd be turning 7 or 8 doors in to potentially 15-20-30 doors we are collecting rent from.

What I would like to ask of the experts of the forums is... what am I not thinking of? What else do I need to consider? Am I even in the right ballpark with what I think we should do next? Please remember, I am mostly a complete newbie when it comes to terminology and strategy, so if you could break down any advice accordingly, I would much appreciate it. Thank you in advance!

[Matthew McNeil]

For not having any RE education I congratulate you and your wife for acquiring the portfolio you currently have. Well done!

I'd be curious to know what your return is at $5-6k per month.  Obviously, you don't have $1M into the property.  You wrote that you have no loans on your portfolio. I'm guessing here; if you've invested $500k then you're getting between 12-14% (at $6k cashflow), which is good.

My advice would be not to consolidate, primarily because you have a lot of equity in your portfolio which you can easily use for leverage to purchase additional properties.  Best route would be to pursue the cash-out REFI option as @Jerry Padilla wrote. 

I'd recommend that you study up on healthy LTV (loan to value) and come up with a percentage that you feel comfortable at. You're currently at zero. Most RE investors are happy at 80%. Personally, I'm between 30-50% with my properties. Also, since you're worth $1M, I'd advise that you study up on Asset Protection and make sure you're protected.