First Rental Complications

[Charles Goodwin]

Hey Everyone!

Earlier this year (April) I bought a duplex for $49k with a short term interest only loan. The main reason I went for it was because I knew the rent more than covered the monthly payment and my mortgage broker assured me that I could "easily" refinance the property after I owned it. I waited for three months of rent roll to come in after I raised the rent a much needed 25%, just as my mortgage broker recommended. I then called back to start the refinance process and she responded that the loan amount was too small. I only owe $30k on the duplex and I can't find a financial solution to start paying down the principal. What would you do in this situation?

The value of the duplex has gone up quite a bit since I bought it, is it possible to do a HELOC and then use that money to pay off the interest only loan? It sounds Crazy, but it just might work.