All Forum Posts by: Eric Neeb

Yeah, the 6 unit now having 4 units rented out is now bringing in about $2300/month rent.  I still have a little way to go on the property and need to finish the final 2 units.  Now that I have much better / professional management, I know this property will be in good shape from a cash flow stand point.  Don't know that I could pull any more money out for future investment other than the cash flow.

Darren, I was hoping that the answer wasn't that 70% is all I can do on a cash out refi, but it makes sense.  

Are there other ways I should be looking for to leverage my equity?

Hello BP! First time caller, long time listener.

I need some guidance on how to make the next step in real estate investing.

Where I sit - I have a single family home (Michigan), a duplex (Milwaukee), and a 6 unit property (Milwaukee).

Single Family - no real equity, only been in the house for about 8 months. Bought this when we moved over to the Grand Rapids area.

6 unit - in a rough area of town, too hard to self manage from afar so I got a property management company to run the property who ended up being awful (I've now corrected this). Still needs significant work to finish off the final 2 units but I have 4 of them rented out. Between purchase and repairs, I'll be about the max amount I really should be into the property and probably couldn't do a cash out refinance on it if I wanted to.

The duplex - I'm 4 years into a 15 year loan on it at 3.75%. Balance is $73k, value probably about $150k. I've always viewed this property as my safety net (I grew up poor and never want my family to fall on tough times). I realize that to make my next move in investing, I am going to have to get out of my comfort zone of being laser focused on paying this property off. If I can use the equity I have in this property to purchase more multi-family properties, I'll put my family in a much better spot so I'm getting more comfortable with the idea of doing a cash out refi.

The issue I'm having - How do I pull out as much equity as possible?

I've called my current bank that holds the mortgage (one of the top 5 largest banks in the country) and was told by the mortgage manager I talked to that they do not do cash out refinances. Seems strange that this is what they told me.

I then did some research online for smaller local banks and was told they could help me out but they only lend up to 70% of the appraised value and at current rate of 4.375%.

I was really hoping I could pull closer to $50k out of the property and then use that to put 25% down on two duplexes that were about $100k each. If I can only do 70% refinance it would be more like $30k to use.

Any advice?

Eric