What's the best strategy?

[Christopher Piper]

My wife and I have a rental with a 3% mortgage on it that nets us $300 a month.  We also have our personal property that would accommodate us putting two bedroom, one bath rental spaces in them.  

We're considering selling our current rental to finance these spaces with no loan.  In return it would net us 10 times our current profit from the single rental.  Or we could use the Heloc money we already have to finance this project.  Our profit wouldn't be nearly as much and have interest to consider. 

What would be the smarter move here?  

[Ghassan Jabali]

Hello Christopher,

I hope you're doing well. Both have good merit to them, however, it may depend on what your overall long term goal may be. Many individuals, especially with a 3% mortgage, may want to hold onto the property and keep it for the stable income and to grow their portfolio. Doing a HELOC can help you keep your rental property while acquiring more assets during a time of market uncertainty. We would definitely recommend though making sure the rental property is in a Trust or LLC if you are planning on keeping it, as well as moving your personal residence into a personal residence trust for more anonymity as you plan on house hacking it.

Note: This information is for educational and informational purposes only and does not constitute legal, tax, financial, or investment advice. No attorney-client, fiduciary, or professional relationship is established through this communication.