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Updated over 5 years ago on . Most recent reply
What would you do? Advice on duplex I currently own
Hello all and thanks in advance for anyone taking the time to chime in. I have a duplex in a desirable area of CT. 2 BR /1 BA down and 1 BR/1BA up. I've always had an issue renting the upstairs because the bath is tiny and due to roof structure, only a tub no shower.
Right now I have a super expensive commercial loan on it - 9.9%! The payoff amount is 151k and the current value is around 269k. There is a pre payment penalty of 4285.
I'm going to do a renovation on it which involves opening up the roof, and adding 1 or 2 more bedroom upstairs. This will allow me to have a larger bathroom with shower and more rental space upstairs. This reno will cost around 70k.
After the reno, I could get 1200-1400 for upstairs and 1400-1600 downstairs. 2800/month conservatively.
So my question is, should I raise capital just for the renovation OR raise enough for renovation and paying off the loan? Any other ideas would be very welcome as well.
Thank you!!
Most Popular Reply

- Washington, DC Mortgage Lender/Broker
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Hey Molly
After dumping 70K into the property, what's it going to be worth? If it's 269K and you've got equity, why not do a hard money deal at close to the interest rate you've got right now and finance the renovation and then refinance into a long term loan that makes more sense. Rates on portfolio loans are going in the 6's right now with no income verification.
Just a thought
Stephanie