Cash Out Refi on a rental Property

[Ali Kattan]

Greetings all,

I have a rental property that I purchased a few years back for 85K. I currently owe 60K on the mortgage and comps are showing the property value at 130K.

I’ve been offered some decent rental generating properties via land contract through a big time investor that wants to sell some of his rental homes. If I refinanced my rental property and did a cash our refi in order to buy 2 or 3 land contract homes, would this be considered a bad investor move?

My thought process is if I can use my cash out refi money to put the down payment on the land contract rentals, let those pay off the contract and have 2-3 paid off homes in 4-5 years. Any of your input is greatly appreciated!

Thanks,

Ali