All Forum Posts by: David Mesteth

I'm going to say: "That's one way to do it, but be aware..."   If you refinance your home, your property taxes could possibly reset to the higher valuation your home now has.  It may depend on if there are laws in your state that limit property tax changes from year to year... but on an investment property, just like when you buy it, a refinance can cause the taxing authority to re-evaluate the taxable value of your property.  So check into that.  

Every answer in investment real estate right now sort of starts off with, "Well, last year..."  You undoubtedly have a lower rate on your primary than what you would have with a refi.  Each step of risk adds to the interest rate on a loan.  So a loan with 30% down will likely have a lower rate than with 20% down.  Likewise, a refi will have a lower rate than a cash-out refi.  

Your question has a balancing point you have to answer for yourself:  Is it worth incurring $5,000 in fees, plus an interest rate that will probably add hundreds of dollars  to your mortgage rate (if you have a descent sized house / loan amount)?  Usually the answer is going to be "no".  A cash out refi is going to at least be in the 7% right now I'm betting.  If you have a 4% loan on your house, it doesn't make much sense to me to give that up.  

A better course of action might be to look at a Heloc.  That is a separate 'loan product' that would not reset the value of your taxes, and would incur less fees.  Your current loan would stay at the lower rate.

As for living in the home with the higher rate... that's just personal preference.  I guess I would ask, "Why wouldn't you continue to live in it?"

Randy

To buy real estate with? For an existing business? Is it through a credit union or bank? Would just need some more context to help you out.

@David Mesteth I googled and found the South Dakota Multi-housing Association. They offer on-line education programs. Don't know if that fills your needs or not https://www.sdmha.com/online-e...