I bought my house 5 years ago for 250k at a fixed rate of 3.5% for 15 years. Currently I owe 111k in principle because I was paying additional principle for like a year. My monthly note is about 1.8k including escrow. Is it the right move to do a cash out refinance for 30 years to lower my monthly payment and use that equity for down payment for a SFR or 4plexes to rent out to create equity/cash flow? I have my improvements on my home that brought up the value to 270-280k.
It's difficult to say without knowing more about your situation, but in general I'm a big fan of this strategy. As long as you can comfortably afford the new mortgage payment, and you're reinvesting the cash, this is a great way to grow your portfolio.
I'm in the process of buying a SFR this month with 30years financing. So I won't have any available cash for down payment for another rental. I just feel that this monthly 1.8k a bit high on a house that I'm not making money on and the interest is roughly $350 right now per month. I still have 7 years left to pay it off if I just continue to make the monthly payment without paying additional principe.