Hey guys, I’ve been approve for a owner occupant loan. I will doing 80-15-5 loan and I’m actually closing in on a cash out refinance for my current multi family home. Is it best to close out my refinance first then go forward with my second property?? I really want to use the equity from my current home.(cash out refinance) But I have an advisor that suggest to go forward with my 401k as a leverage instead. And I’ll just save the cash out money for emergency. What do you guys think?
Real Estate Broker · Hyde Park Tampa, FL · Member since 2019 · 2k+ posts · 3k+ votes
6y
I think you need a new adviser. So you're going to pay interest on money that you're not re-employing, right? And, unless you can reinvest it for 2.5% (rate of inflation) PLUS the mortgage interest rate, you'll be losing money. Your 401K is invested - and hopefully earning a good return - so why remove an investable asset to hold leveraged funds for some unforeseen whatever.
your right, it all depends on how many months I will repay as I am currently employed. But my thing is .. either way. My tenants will pay everything out. But my paycheck will be less unless I just do a withdraw. But your right! Thanks again