Aloha! I am "somewhat" of a new investor and not... This is a 2 part question...
I purchased investment properties in 2004 and 2005 with the intentions of buying and holding. One property in the Dallas area has been refinanced into a lower rate and has grown a little bit in equity. My other property is close to Nashville is still upside down and I can't refinance the ARM loan to a lower rate because it's still upside down, that is at 7% currently. I purchased in HI and equity has appreciated to a healthy level, however, I have only owned this house and lived in it for 18 months. I have the opportunity to cash out refi around $30K on my HI house, but am a little nervous because it's the house I live in. I had heard in the past to pick one investment property to cash out refi a little bit at a time to buy more investment properties when I can. What are your thoughts on cash out/refi'ing on an owner occupied property? Then, if I cash out/refi some should I pay down part of the Nashville mortgage so I can lock in a lower rate and refi to pay less interest. Both investment properties are currently rented out are breaking even. I would like to be able to have more passive income for later. Need advice from all of you....mahalo!
So you want to take good money out of your personal home to pay more on it each month (potentially putting it at risk) so you can put it into a non-performing investment. If the economy turns (election year) it puts both the investment and the personal home at risk. If thing go right you may get a extra $200/mo in cash flow, maybe. It sounds like a lot of risk, for not much reward.
The Nashville market is hot now and prices have gone through the roof. Most areas have recovered or past the pre-bubble prices. However this is not a great city for cash flow. I suggest you find a good agent and see if you can sell it for what you owe, or more. You may be surprised. Feel fre to message me if you do decide to sell. If it is near the city, I'll be glad to make you an offer, as-is.
Ok, thanks for the insight! I need as much perspective I can get.