All Forum Posts by: Paul G.

Don't forget, another factor that is not entirely related to Real Estate as a whole, at least in my field, the market contracted and lots of people were out of work.  

Couple no income with being under water on a (or multiple) property and you're in a bad spot. 

Second, if you go FHA for the new home buyer, there is a stipulation that you need to live in it for a year. You can't get new homebuyer advantage and use it as an investment property. That would be mortgage fraud.

Not to mention if the property is rent controlled, then you can't just "raise the rent to 2K"

cash out refinance should not have any bearing on your investment property.  The bank can't tell you, nor would they, what you can and can't use the money for.  And as far as they're concerned, you could have used it for just about anything.

There will be no links between the two (primary refinance and investment purchase).

If anything, the hard credit pull will show up on your credit report, but that should be about it.

Uhm, if it's really 1.7M, your mortgage alone on it would eat up about 7K a month.  That doesn't include Taxes and Insurance, just PI.

What you've listed right now for rent is only about 3.5K...

Well... Refinancing will bring you up to 75% of appraised value.  Which would only be 67,500.  Furthermore, the fees you would incur for refinancing would eat all of that up and more.   So, from your requirements of 10K needed for down payment, you probably won't be able to do that through a refinance.

Ahh yes.  That was the piece I was missing.

The 15 year is attractive from a equity standpoint, but I tend to prefer cash flow.  How long are you planning on owning the property?

Using the 50% rule, you will have plenty of cash flow on the 30 year.  On the 15 year, not so much.  Not saying you wont cash flow, it will just be tighter. 

What would a 30 year fixed be? Why the ARM?

@Tyler Parker that is correct.  

Primary Residence:

only pay taxes on anything over 250K of gain.  Married, it's 500K.  Again, this is only on the gains, and not full price of the house.

Investment / Flip / Etc

Pay tax on everything.  If it's held for any amount of time, you'll have depreciation recapture tax as well.

with a 15 year amortization, you should be able to get much better than high 4's low 5's.  I'm getting a cash out refinance right now at 4.875% on my investment condo with a loan under 100K for 30 years...  If I was getting 15% I believe that would have been .5% lower