What is your long term strategy with this property? If you at some point are going to turn it into a rental then you will likely need to get your payments lower. If you intend to sell then just build your equity. If you intend to live there forever then the cash out refi might be a good call.
It all depends on your game plan and what your numbers look like. Can you get enough rent to cash flow when you move out? Maybe it is going to appreciate enough that selling in a few years makes the most sense. Figure out what your end game looks like and then do what you need to to get there.
Unrelated, I hope you are saving the money that would be going to your house payment as that would be my first step towards the next property.
My goal is to invest in multi-family units full time. In the future, I would like to move out of Philadelphia into one of its suburbs to raise a family.
I view the house I am currently living in as a start. If I do get to the point where I have multi-family properties and a family home, it would make the most sense for me to sell this property so I can narrow my focus into strictly managing and acquiring bigger deals.
However, I am trying to figure out what I can do now to start the process, and how I can achieve my goals within a reasonable time frame.
Like you said, would it be the best choice just to lower the payments on my current home so that renting it out would be more lucrative? Or, should I put more effort into getting a cash flowing deal now?
Right now, it seems to me that cashing out to get a deal makes the most sense…but I’m apprehensive because I don’t want to have a misstep now that will make it difficult to get a home in the suburbs later on.
@Richard Atella You haven't mention how much equity you have in the home. You can always get HELOC to work on next deal. Eliminating PMI is good option and ask for HELOC after closing on refinance.
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