Advice on refinancing vs. saving so I can buy my 2nd property

[Mike B.]

Hi all,

I've been reading through the various posts about refinancing and can't seem to find the best answer, so I need some advice. 

I'm living in my first home (investment property) which is a 2 unit property, purchased for $275K using FHA loan (3.5% APR!), but only put 3.5% down due to renovation costs (it was a gut). Appraisal 6 months ago valued the property at $350K. My current loan balance is $260K plus I have a HELOC with a $12K balance. I've lived in the property for 2.5 years. Monthly PITI (plus the MIP) totals about $1850/month.

I want to purchase a 2nd investment property (single family home, fix up and live in it for 2 years while renting my current property).  I have a 740+ FICO, great income with my job (medical field) however with student debt (and some materials paying off for renovations still) i don't have much savings.

I was thinking of refinancing into a conventional loan or a 5/1 ARM to save on MIP and interest rate and aggressively save x1 year to then try and purchase another fixer using an FHA loan again (because I can put down less). And then continue to repeat this process.

Questions:

• Do you think I have a half way decent plan or should I go another route?
• Would I be able to refinance into a 15 year fixed (conventional loan) or a 5/1 ARM knowing that I don't have that much money (physically) into it (vs. the equity and value of the property)? I also would only be able to get together a few thousand dollars in 2 months to cover closing costs, but not really any other money to 'put down'
• Do you advise, instead, that I do an FHA streamline refi, save my money (working my regular job) and in 2 years, try and refinance then (or sell and purchase another property)??
• OR should I just sell my property, cash out, and roll that into another property to fix up and live in for 2 years?

I would like to continue flipping in real estate and ultimately do a few flips, but have great rentals for the income (so I can quit my day job.. future dream!) **Since my current home was a complete gut, I know it's nearly maintenance free and I debate whether or not I should sell it, knowing there's little maintenance and I can demand top dollar for my area (which would be ~$3K/month in rental income, less my current $1800/month PITI).

Sorry this post is long.. I need some advice on which way to turn down the road. Thanks in advance!