Refi on my rental... disappointed with number

[Omeed O.]

Im trying to set my self to buy my 2nd rental. But I can't get my numbers to work and justify the refi.

Current rental paid in cash no loan on it.

Purchased for 70k comps are $120k.

Rents for $1300 a month. Same tenant for 4 years. I haven't raised the rent on him, he's been great but I've given him notice that rent is going up 3% a year from now on.

HOA,tax, insurance $800 a month

So I net $500 a month

My broker offer me 75% about $95k at 6.2%

He said my DTI is high and want me to pay off outstanding debts with the refi. About 40k in car and medical.

Leaves me with $50k after closing. And $600 a month in payments. And I'll be negative $100 on the rental.

Then on top of that I'll only have 50k to play with in Houston tx.

Would you do the deal?

Sell the home?

Do nothing?

[Maurice D.]

If you are trying to raise cash, and get out of debt, sell the 40k car and downgrade to a 10k used car until things get better? get rid of the car payment. Condo's are hard to cashflow due to the high HOA. Sell it if it doesn't cashflow and buy a cash flowing rental with no HOA