New Member in Yakima

[Juan Jimenez]

I hope to learn as much as I can, here at BiggerPockets, before I do my next deal.

I have been a frequent listener of BiggerPockets and recently finished reading:
The Book on Taxes for the Savvy Real Estate Investor by Amanda Han and Matthew MacFarland
Finding and Funding Great Deals by Anson Young

I am Currently, reading The Book on Investing in Real Estate with No (and Low) Money Down by Brandon Turner

I became a landlord by default. When I purchase my new house, I was single and was not necessarily shopping with a family in mind. My first buy house was tri-lever home that I got for 152K with 3.5% down on a 30 year with a 5.5% interest rate

Once I got married and had our first child, We refinanced to a 15 year mortgage with a 3.5% interest rate. Eventually, we decided to buy our home where we would raise our kids and grow old.

We debated on selling the tri-level, but decided to rent it since we already had the house and we would not walk away with much cash. The house is in a desirable neighborhood and had no problem renting it.

Fast forward three years later, we are on our second set of tenants. I have crunched the numbers and factored vacancy, maintenance, capital, and management expenses and the property has a negative cash flow.

Since we have a 15 year mortgage and appreciation, we have about 100K-140K in equity on that property I really don’t know until we have it appraised. We do have 9.5 years left on the loan, which is a plus.

I toss the idea of using that equity for the next deal or have it pay itself off or selling it completely in order to fund our next deal. We could also do it the old fashion and save for a down payment.  

Any advice would be appreciated.