Opinions on All in One? - Gearing up for first property purchase
Hello everyone!
Long time lurker and first time poster here...
For the past 3 years I've been turning my wife and I around financially to purchase rentals in the future and I'm coming to a fork in the refinance road and would love some feedback from anyone who have gone before us.
Three years ago, we had $17k of personal debt and very little savings (a few thousand). Today, credit card balance is 0 (down from maxed at 14k) and my car loan is payed off; it was an Infiniti that I sold and promptly bought a corolla (great move for us). I have 6 months of expenses saved in a money market and another 7k in a personal brokerage account with Fidelity - this will be the fund I'm adding to for a down payment. My wife and I have no children, but she has some pretty severe medical issues and cannot work so I've learned to become very disciplined with our money as I'm the only income source right now aside from selling auto and homeowners insurance on the side.
Now for the mortgage info: we purchased our home for right at 185k in 2017 and currently owe 174k. The market has been crazy around Charlotte and we've had 2 houses in our neighborhood sell in the past 2 months: 1 for 260k and 1 for 270k. One is newer, the other older, one has more land, the other less; both are within 200 sqft of our house and neither has a 2 car garage like ours. The point is I'm relatively confident that our house is worth around the 265k mark which would put us right around 90k in equity if we got the house re-appraised.
I'm looking to refinance to get us in the best condition possible to fund our first acquisition - hopefully in the next 2 years. I was looking at a conventional refinance that would drop the payment by about $300 per month, but then I found (on the BP forums) the 1st lien position HELOC, or Vortex mortgage, or All in one Mortgage, etc. I know there are some differences but I'm interested in the availability of our equity to make cash offers, and I'm confident in my financial discipline to keep on the whole "use the HELOC as the main checking account and deposit your paycheck in it" concept. The concern for me is that, while we are cashflow positive, it's not astounding... the medical insurance premiums and HSA contributions run pretty high which keeps liquid cash flow at about 350~400 per month and sometimes less.
Has anyone on here been in similar financial conditions and then gotten the all in one mortgage? If so, were you and are you still happy with it? I'm open to critique, options and opinions but definitely reviews. I've talked with several lenders and all but one have tried to steer me away from the 1st lien position HELOC since, you know, interest for the next 30 years...
Thanks!
Jordan