House hacking steps after 1 year

[Luis Ramirez]

I am just wondering on how does the refinancing part works and I cant seem to understand it. Let say that you buy a house and you successfully do house hacking. Once a year has passed, what are the next steps? do you refinance your mortgage so you can get a downpayment for a new house and start the house hacking again? I am kinda confused and if someone can help it would be great? 

[Bradley Dosch]

Hey Luis, there are lots of options for you after you fulfill the 12 months owner occupancy requirement. This is where the real magic of house hacking begins! Ideally you can find a way to move out of your first house hack and then buy another one. This is a careful process that requires the help of a good lender who understands what you're doing. 

Depending on the amount of equity you have in the first house hack, you can pull it out to help with the next one. Although, the down payments are so low that you could just use your own savings from the past year. I would recommend against a refinance though. If refinance with an owner occupant loan, you'll have to stay there another 12 months. If you do investment loan, the terms will be much more unfavorable. I would recommend a HELOC. Do this while it's your primary residence and there's no requirement to stay for any period of time. I'd get a HELOC even if you don't need it because it's a great way to access funds if you need them in the future.

Again, it can be slightly tricky DTI wise covering your first house hack and then transferring to your second. Having a good lender will help you a lot. Hopefully you're able to make it happen Luis! Lmk if you have any more questions