All Forum Posts by: Jess Kempf

Thanks for helping us think through this. 

1. We did the 4-square analysis to determine cash flow. We based on the new mortgage payment we would have after a cashout refi, looking into rent comps in our area, self-managing, and the other factors listed like repairs, vacancy, and capex. It would be around $300 cashflow if we didn't pursue cash out refi which would lower our mortgage payment (we currently have a 15-year from the Dave Ramsey's pay-it-off-asap plan). 

2. Correct. We do not have the cash for 20% down on a new home purchase so that's why the cash out refi on our primary was considered. The amount we can get for a cash out refi is based on the numbers provided by a lender. Are you're implying we take out a new loan for a new home and leave the loan alone for the primary residence we would rent out after moving? 

Until two months ago we were pursuing early mortgage payoff Dave Ramsey-style on our primary residence. We discovered Bigger Pockets and have been drinking from the fire hose trying to learn this new language of REI and would appreciate help thinking through our next step.

We have 4 kids, 6 y/o and under and want to grow our family so we're looking to move in the near future and rent out our current home. 

We purchased our current home for $210k, mortgage was $120k and currently at $45k. The current value of our home is around $270k.

We ran the numbers and could cash flow around $600 monthly from our current residence.

Any advice on the finance side going forward? Pursue a cash out refi on our home, use the cash for a down payment on a new primary residence, rent out our current home and start saving the cash flow for a down payment on another investment?