Brrr or sell advice...

[Aaron Millis]

Hi BP,

So here's my situation: I have a rental property that cash flows well and now has a nice chunk of equity (thanks to appreciation). I'd like to do the BRRR strategy and do a cash out refinance so I can use the money for more real estate investing endeavors.

The property is worth 170K - I owe 103K- and I put about 25K into it... between a down payment, closing costs, and rehab.

I'm still talking to a bunch of different banks/credit unions.. but the general feedback I keep getting is that I can only get 75%LTV. Long story short- thanks to the property being an investment property/a condo/and my below 700 credit score - I would only be able to get back about 16K cash... and on top of that my interest rate would be considerably worse. It's at 4.375% right now making my monthly payment about $730. If I do the refi I've been told it would go up to like 5.8% which would increase my monthly payment to nearly $1000 per month. As terrible as that sounds my rent for the property is $1700 a month. So the higher payment would hurt but it wouldn't kill the cash flow.

-On the other hand I have owned and lived in this property for 2 years so, if I'm correct, I know that means I could sell it and not have to pay taxes on the profit. I know I could sell this home pretty quickly with very minimal effort.

I don't actually want to sell this property because it's a great rental, and I never really seriously considered it until now. But it just seems like a waste to have so much equity in the home that's doing nothing for me!

I'd love to know what any of you other investor/landlords might do in my situation. Thanks!