Oregon property, refinance or other option?

[Casey Oberg]

Hi everyone! Hopefully an easy question here but first some backstory:

My mom inherited her parents house, completely paid off and just appraised for almost $500K. She and her brother share it, he wants out, and my mom wants to keep it. 

I told her that maybe she could take a cash out refi to buy his half and everyone is happy. She’s worried about the mortgage outstripping what they are renting it for which is $1950. I thought if she gets 70% she would be able to give him his money and have almost $100k (which I think she should use for more properties but she is uncomfortable with) for any unexpected repairs or if there is a difference of a few hundred in the mortgage to rent. 

Is this the best way to go about it? And if so what avenues would you look into for the best rate?

Thanks!

Casey

[Taylor Rhodes]

Quote from @Casey Oberg:

Hi everyone! Hopefully an easy question here but first some backstory:

My mom inherited her parents house, completely paid off and just appraised for almost $500K. She and her brother share it, he wants out, and my mom wants to keep it. 

I told her that maybe she could take a cash out refi to buy his half and everyone is happy. She’s worried about the mortgage outstripping what they are renting it for which is $1950. I thought if she gets 70% she would be able to give him his money and have almost $100k (which I think she should use for more properties but she is uncomfortable with) for any unexpected repairs or if there is a difference of a few hundred in the mortgage to rent. 

Is this the best way to go about it? And if so what avenues would you look into for the best rate?

Thanks!

Casey

Hey Casey, I think what you outlined is a good option.

Does your mom want to keep it out of sentimentality, or is she truly trying to use this home as an investment vehicle?

If she is using this property as an investment vehicle - selling could be a more desirable option as she could put the money to work in a slightly better investment property (for return purposes) while at the same time, getting her brother out.