I own 1 rental property but need money to buy a home

[Brandon Almanza]

My wife and I are expecting a second child. The house we are in now (in Texas) is not going to be big enough. We owe $60k on the house with plans to sell for $135k. Additionally, we own a rental property in New Hampshire that we owe $230k on. (Market value $440k) We have excellent tenants in the home that pay $2k a month and want to extend their lease. My dilemma is the new home in Texas we want is going to cost $550k and we were only approved for $419k. (Due to the amount of loans we already have) So I need roughly $56k after we sell our current house and do not know how best to get the capital. I don't want to sell out property in New Hampshire for numerous reasons but it is the only option I can think of. 

What would you do? Any help you could offer would truly save me a lot of stress.

[Matt Lefebvre]

Hi @Brandon Almanza, that sounds like a huge jump in price point to go from $135K to $550K.  I'm sure you can find a more affordable house that suits your needs in your local market... if not, then you should consider expanding your current residence.  Try and get some quotes to add on a bedroom or bathroom depending on what your needs are with the new kid.  That could be a far cheaper option than buying a new house and it could even improve the value of your current residence.

While the market is pretty good for selling in NH right now, I'd recommend NOT selling your investment property that's earning you money every month to put the cash into a personal residence that's costing you money every month.  I could see that setting you back quite a bit from any investing goals you might have.  Even selling your current residence and renting a larger house for a couple years might be a better option while you wait for the market in Texas to cool off and you can afford your needs for a better price.