How do I use my first property to buy my next?

[Eric Bate]

I bought my first duplex in Minnesota in October, 2016. I lived there for a full two years, and then I moved to Chicago to be with my gf/fiancee. I rented out the unit that I was living in, so it's fully rented now.

Rent roll = $1,975/mo

Zestimate = $217,231

Remaining Principal on the loan = $105,165 (30 yr-fixed, 3.625%, no PMI)

I know I could sell it. I would get the capital gains exclusion on the unit I lived in. I'd rather hang on to it if I can, though. How could I go about tapping the equity to buy another property down here in Chicago?

Thanks,

Eric

[Tim Swierczek]

@Eric Bate based on the numbers you provided you could do a refinance and take cash out to support a down payment on a new property in Chicago. There are several ways to do this. A traditional refinance would likely be your best bet because even though the interest-rate would be higher there would be no mortgage insurance in your net cost would be slightly higher than what you're paying on the money now. With this amount of equity you could take a HELOC but the terms and investment properties for he locks are awful end it would come with several downsides I don't like it much.

 If you’d like some examples please PM me