👋🏾. Newbie here! I'll be house hacking starting February 1st. Working on upgrades, now. Which would be better to finance ... Refinancing for cash out or HELOC? Thank you, in advance 😊
I would definitely say refinance! Are you just following the BRRRR Strategy?
Assuming you are staying in the property for awhile cash-out refi is probably your best bet. HELOC's typically have variable rates that can jump up if you have the lien for awhile. Rates are obviously very low now but 2009 still gives me nightmares.
Downside of cash-out refi is, typically closing costs are more than HELOCs but rates tend to be much better for cash-outs.
Hope this helps!
@Ryan Arsenault Thank you for your info...yes, it does help!
@Ryan Arsenault . I purchased the property last year. Decided to house pack about months ago.
@Joshua Janus Thank you for your reply! No, I'm not doing BRRR. I purchased last year and decided to house back about a month ago. Just found out about it!
Refi is a better option for a long term hold.
@Andy Garretson thank you for your reply! It's not going to be a long-term hold. I plan on moving on to my next house hack February of 2023... Do you still feel that way financing is a good idea? I appreciate you!
As long as you are going to keep this property and not sell it, a fixed 30 year loan would be better than HELOC.
@Andy Garretson Thank you!