Primary residence refinance

[Travis Kurtz]

If I do a cash out refinance on my primary home to invest in my first rental property, is my home then tied to the investment property and will I have an issue refinancing the investment property when we finish the renovations using a BRRRR strategy?

[Dean Miller]

@Travis Kurtz I would like to suggest another method to fiance your first rental property. If you have sufficient equity in your primary home you could take out a home equity line of credit and use the cash from the HELOC to finance your rental property.

The advantage of this method over doing a cash out refinance is lower closing costs, you will maintain your current position on your amortization schedule for your primary home, and the cost of holding cash will be less since you will not have to pay interest on your cash while you're waiting to buy your property.  

After you buy your rental property let it season for 6 months then do a cash-out-refinance on the rental property then use the cash from the refi to pay off the HELOC.