Do I refinance to HIGHER interest rate?

[Jordan Batchelor]

Looking for a little advice

I currently have a house hack that I purchased late 2020 with a VA loan with zero down. It has appreciated to at least 20% since the purchase. My plan was to refinance to a conventional loan with the idea of recycling my VA loan into another multifamily in the future. The problem is that the interest rates have gone up.

Numbers below

Original loan
Purchase price: 780K
Down payment: $0
Interest rate: 2.25%
PITI: $3,915

Projected refinance option

Loan amount 780K
Interest rate: 3.75% – 4.2%
PITI: $4458 – $4748
Monthly payment increase: $543 - $833

I’m in the San Diego market and currently getting $3100 for renting a portion of the property that will increase to $3300-3500 once current tenants move out. Once I move out of our space we’ll be able to get roughly $1500, so total rental value $4,600 - $5,000.

I’d appreciate any help or insight.

Thank you

[Mark Frattini]

@Jordan Batchelor

VA is the best loan out there and I would do exactly what you described. Rates while not in the 2s anymore are still very low. After your next acquisition you will then own and operate over $1.5M in real estate which didn't cost you hardly anything to acquire in a city of rapidly increasing rents and demand for housing.