All Forum Posts by: Michael Bracken

Originally posted by @Tyler Hodgson:

@Michael Bracken why not do cash out refi on primary at 4.5% 30 year fixed rather than a 6% variable heloc. I would be locking in as much 4% 30 year money as you can right now. 

If the rental isn't cash flowing with 70-80% LTV you might be best selling that rental to get the equity out and finding a rental with lower taxes. Have you disputed the property's assessed value?

Even on the rental I think a cash-out refi at 5% for 30 year fixed would make sense. I'd rather have $50k in hand with only $100/month in cash flow than spend $40k out of pocket to get $1000/month in cash flow. That would take like 100 months to recapture the cash savings there. I don't know the exact numbers on your property so these are estimates, but I hope you understand what I'm trying to say. 

In summary, I'd lean towards cash-out refi on 30 year fixed loans to borrow some cheap money. Hope this helps! 

Right, the refi cash out $50k is money I already have (that renters and appreciation gave me). As opposed to a line of credit that I pay back even with the cash flow. We all know interest rates are going up from here. I feel like in one scenario the gift is already freely given in the other I've arranged to pay for it.  I'm sure I over estimated my cap ex as I have just put a new roof on it. I have never disputed the tax assessment but that's a great idea. What could it hurt?

Greetings, I would like to raise some money for conventional financing of a duplex or 4 plex. I have a rental with 110k equity owe 39k 6.5% and a primary residence with 100k equity owe 98k 4.5% 15 year note. If I cash out refi the rental it won't cash flow. ($4500 yearly taxes) I was thinking about taking a Heloc fixed 6% (initial 40k draw) from my primary residence and paying off my remaining rental mortgage 40k in one payment. Paying off the simple interest Heloc afterward is much, much....much faster than the 2k I paid on the amortized mortgage principal all this year with $900 P&I payments. 4 years vs 20 years for the same $900 a month by my calculations. Lastly, I'd have a 60k 6% variable rate Heloc (that's the most I qualify for in Texas)with a $0.00 balance ready to use at anytime. 1k cash flow from the rent house, plus the cash flow from the acquisition to pay off the Heloc. Is this a good plan? How can I make it better? Where am I wrong?

Actually that link probably violates the BP terms of service in this forum. Just a Bing search result not any affiliation of mine. I'll get the hang of this. 🤧

Fortunately I'm a tad narcissistic. No problem posting my pic. 🙄

You need a good owner finance lawyer here in Texas to do the paper work. http://www.lonestarlandlaw.com owner_finance.html There are tons of legal requirements to meet. But a great 👍 idea 💡 none the less!

I was just on my states (Texas) website and found that a LLC that is 100% veteran owned is free to start and no fees for 5 years. Looks like my next one is on you Uncle Sam🤓

Greetings, I would like to raise some money for conventional financing of a duplex or 4 plex. I have a rental with 110k equity owe 39k 6.5% and a primary residence with 100k equity owe 98k 4.5% 15 year note. If I cash out refi the rental it won't cash flow. ($4500 yearly taxes) I was thinking about taking a Heloc fixed 6% (initial 40k draw) from my primary residence and paying off my remaining rental mortgage 40k in one payment. Paying off the simple interest Heloc afterward is much, much....much faster than the 2k I paid on the amortized mortgage principal all this year with $900 P&I payments. 4 years vs 20 years for the same $900 a month by my calculations. Lastly, I'd have a 60k 6% variable rate Heloc (that's the most I qualify for in Texas)with a $0.00 balance ready to use at anytime. 1k cash flow from the rent house, plus the cash flow from the acquisition to pay off the Heloc. Is this a good plan? How can I make it better? Where am I wrong?

You might want to think about the legal aspect as well. What are your landlord legal responsibilities? What are the tenants rights? Your needs might change in the future. You could get hurt or disabled in some way and need prop management. I think any deal needs to have room for management and if not needed, then icing on the cake.🤑

Thank you for introducing me to @Jay Hinrichs. I'm finding that it's beneficial to listen to every podcast even if you think it might be off topic of your personal interest at first. You never know what you can learn at any time from anyone. Mr. Hinrichs is a real pro.