Refinancing out of FHA for second home - Rate and term?

[Account Closed]

Good afternoon everyone!

Long time lurker, finally becoming an active member. For some background, my wife and I live in Northwest Arkansas and currently own a home near Beaver Lake. We closed in July of 2018, and spent a year renovating the property while living there full time. In October of 2019 we started renting out our home as a STR, and it's absolutely taken off. A typical month in the slower season returns around $2,300, and the summer season should see around $3-4k/month.

We're looking to purchase our second home, and would like some advice on next steps in regard to financing. We're currently at a LTV of about 86% (estimated on original appraisal/current comps), so cash out refi isn't in the cards, at least not yet. However, I've spoken with a couple of lenders regarding rate and term, which I assume would be refinancing into a conventional loan with PMI?

Lender stated: 30 YR Fixed, 3.875%, Estimated Principal & Interest= $672.44 (Does not include taxes and insurance), Estimated PMI= $77.46

So, here are my questions. Any advice would be greatly appreciated:

-If we were to refinance into a rate and term, would it be appropriate to purchase the second home (multi-family) via FHA again to take advantage of 3.5% down again? Is there a waiting period between refi and second home purchase?

-Will any of our Airbnb income count towards purchasing the second home?

-Should we just wait until we hit the threshold (80% LTV), then cash out refi and allocate that money towards the next purchase?

Thank y'all for the advice!

[Noah Brinker]

@Joshua Hittinger

+1 to Ryan’s advice. Talk to your lender and they should be able to help you understand what your options are (or find another one if you don’t like their answers)

You may have already run into this, but FHA loans require you to have a certain % if equity in the home you're vacating to qualify for another FHA loan. I believe it's 20%.

Airbnb income may count towards income, but it’s possible it has to show up on your most recent tax return. Probably a question your lender can answer as well.