The only time I'd say it's an okay idea is if either: The area you're investing in is expecting so much appreciation that you will easily profit off that (watch out for mortgage interest though...the appreciation needs to be higher than what you pay in that and expenses to make it profitable)You have some specific reason for wanting to do it- family ties, future home, major long-term hold, etc.Maybe I'm forgetting another one, but those two are all I have for now...

Check with your lender about any owner-occupancy requirements tied to your mortgage.Market Analysis: If you plan to rent it out in the future, take a close look at rental market trends in your area.

There are risks as you are tying up your primary residence in the project.

Vanessa,I second others comment on the advice of putting yourself in the owner's shoes and figuring out your selling points from that point of view. 

They are just going to use their 2nd VA loan to buy their next one while this one is tied up. 

It's been disappointing when the fed cuts caused increases in the 5yr rate (that our dscr loans are tied to).

@Tom HallAt 7% if you can I would pay it down as investing it net after tax gains may not get you the 7% you are paying - so it’s less riskDownside is you lose liquidity of that money as it’s tied in your propertyIf rates come down in future you can refinance and even take some of the cash out.Regarding your question are rates coming down, a lot of factors come into play but right now it does not appear there will be significant changes to rates over next 3-6 months.

If they won't let you build on it, explore doing a lot tie agreement so that you can combine the parcels and when you go to resell it, you can ask for a higher price point based on the large lot.

what are the laws in CO regarding unlicensed wholesalers tying up property advertising it and collecting a fee at closing is that even legal in that state. ???

This card is tied to the first bank account and is on auto pay.