I'd like to rent out my personal residence I bought in Dec 21' with an FHA loan but I'm having plumbing issues.
The house value is about 265k and the mortgage is about 215k. I have about 7k in savings but I was wondering if I should use a HELCO or some other instrument to fix the plumbing issues? My house was built in the early 60s and the issue is the cask iron pipes are failing. It's being recommended that I repipe the entire house or reline the existing pipe system. The cost will be 10k - 15k depending on the option.
Any thoughts on where I should get the funding for this project and if it's best to repipe or reline the pipes? I know if I don't fix this issue before renting out the property I'm just asking for a headache down the road with tenets.
Real Estate Agent · SD · Member since 2020 · 137 posts · 65 votes
3y
I think that is good foresight to fix the problem before you get a renter in there! As for reline or repipe, I can't really say much for the lining as I don't have experience- if costs were the same I'd go new. But you didn't mention, with new plumbing are we talking about a new sewer line? Or just your interior house plumbing and supply lines and similar? I think if you have the option of relining your main sewer pipe I'd lean toward that but I'm sure they'd need to scope it and see what they're working with. Regardless, those cast iron pipes are 60 years old at this point so tackling this issue is probably a good idea, and if I were in your situation I'd either 1) take on side hustles, save money and pay cash or 2) HELOC it, fix it, and take on side hustles and pay off that HELOC. I wouldn't wipe out my 7k in savings if that's all you have in savings. If you have other cash and this is your house money savings then I'd consider it I guess.
Just personal thoughts, not saying they're correct but that'd be my approach.
Developer · Santa Clarita, CA · Member since 2008 · 15k+ posts · 10k+ votes
3y
Your current equity position is not enough to qualify for a HELOC so that option is out. YOu could take a personal loan, use credit cards or sell other assets to raise the capital.
As for the repair itself, you state cast iron which is for the sewer line. Plumbing re-pipes for interior are for supply lines. So which is it? Sewer or supply lines need upgrade? If it is sewer, you have several options. There is the excavate and replace method, there is trenchless system option, and their is a relining option. I suggest you get 2-4 bids for each option from licensed plumbers to see what is best. The lowest price is not always the best option.