Hello, I am brand new to real estate investing and am looking for some advice. I bought my first property (condo) in 2004 thinking I would end up selling it, make some money and move into a bigger home years down the line. Last year an opportunity arose to move cross country, so I refinanced and rented the property. I was very aggressive with addition mortgage payments while I lived there and currently have a 40% LTV. The mortgage payment is around 45% of the rent payment I collect each month. I put the other 55% right back in the principle each month. I should be paid off in 4 years at this rate.
What I am looking to do now is purchase a home that I'll live in for the next 5 years (I'm currently renting) or so and then do the same as I'm doing with the condo (refi then rent). I only have 10% that I can put down for home #2. I would be able to afford the monthly payment on home #2 with the 10% down. However, I have a few questions:
1. Should I refinance or put a lien on property 1 to cover another 10% so I don't have to deal with PMI or even the whole 20%. The rent would easily cover the refinance/lien payment with cash to spare.
2. Is it better to continue to work to pay off property 1 as quickly as possible and then use that cash flow to pay down property 2 and so on down the line?
3. Is there another scenario that I am not thinking about? I see people w/ multiple properties, using each property to obtain another, but wouldn't it also be smart to pay off a property?
I do have a reserve for myself and the property 1 and am wondering overall if I am going about property investment the right way.
Please note, I am not looking for mentoring, I am looking for opinions on different paths to go down.
I appreciate your time and assistance with my questions.