Advice on what to do next?

[Rochelle G.]

I own a 2 bd 2 bath condo that will rent out for $1300/month. I currently live in the home, but have a management company on standby with everything already priced out waiting to pull the trigger to rent out once I move. I have an FHA mortgage on the condo at 3.62%. My lender, as well as my real estate agent, has advised me to go with a conventional mortgage on my next purchase, however the huge down payment is hindering that. I was told it would be unwise to refinance my current mortgage into a conventional since I have a good interest rate on it, however I feel like refinancing (even into a higher interest rate) would be more beneficial to me in the long run. I could lower my payment and increase my cash flow as well as open myself up to purchase on a FHA mortgage for my next property. The 3.5% down payment would be very manageable. I intend to buy and hold my properties to rent out as I move out into the next property. I do not mind living in it for a year to fulfill the FHA requirement. A higher interest rate doesn’t scare me too much seeing as how my renters will be paying my mortgage for me as long as it’s fixed. Any thoughts from more experienced investors? Side note: I looked into HELOCS for the down payment on a conventional and it’s just not a good option for me right now