Use exisiting equity to buy another investment property?
Hi, I am a newbie from California here on BiggerPockets and I love all the great information I've been reading. I have lots of questions now but hope to be able to answer some in the not-to-distant future!
Here's my situation:
- The home that I live in has about $400K in equity. I refinanced it two years ago for 30years @ 3.5% and I have pretty low payments (It's worth around $600K).
- I have a rental condo with about $125K in equity. Rent covers principle, interest and assoc. fees but does not cover about $3400 in taxes.
My original plan was to let the condo get about $200K in equity and then sell it and pay off my home. However, I am wondering if I'd be better off taking some of the equity out of the house and buying something like a duplex and hold on to it.
Here's my dilemma, while I have quite a bit of equity, I own my own business and show very little income. I also am an adjunct online college professor and receive very small W-2 wages that I can account for.
Does anyone have any suggestions about how to go about getting financed to purchase a duplex? I also have about 350K in 401k accounts and I'm over 59 years old so I can tap that money without penalty. I also have a HELOC on my home for $100K and it currently has about 20K of that which is used. I have an excellent FICO score. Keep in mind that California duplexes are probably in the $775K - $900K range or more.
Thanks in advance!
Bill Briscoe