Advice on selling to access equity
I have a current rental in Denton (3Bed, 2 Bath) that rents for 2,250/mo. My Tennant is moving out next month and I am considering selling vs holding. The problem I have about 120K of equity in the house that I would like to be able to access to put into some multifamily deals. However, with this being a rental property out of state, I have found it almost impossible to access any of this equity. I have a 2.75% 30 yr loan on the property that is hard to give up. It cash flows gross $400 max and about another $450 goes to principal each month. If I were to sell, I would look to buy another multi-unit property in a smaller town in the $100-120K range that cash flows $400. I just did a deal like this a few months ago on a triplex for 115K that is cash-flowing gross $600. So I would like to be albe to use this cash on 2 more of those deals. Any thought are greatly appreciated
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HI Stephen,
You can always open HELOC or line of credit from your primary house or non primary house, assuming you have sufficient equity and income to qualify. You can obtain up to 90% LCTV for your main primary house that you are living or 80-85% for your investment properties. Rates are typically higher than a traditional cash out refinance, however at least you are not getting the full loan amount + you have the flexibility to draw/tap in the money whenever needed.