Chatsworth, GA · Member since 2014 · 124 posts · 17 votes
I bought a 28 Unit apartment in 2018. I have updated 90% of the units, raised rents and increased the NOI. Interest rate is 5.5% with a balloon payment of 5 years (2022). Is it a good idea (if possible) to refinance with better interest rates and pull money out to continue investing? On the the other hand, these properties are D class. 2/1 brick duplexes with gas wall heaters and window units. These properties are cash flowing nicely, but Sometimes I think it's time to 1031 them to buy other properties and repeat the process again. What would you do in a similar situation? Thank you in advance for your input.
Rental Property Investor · Prairie Village, KS · Member since 2015 · 2k+ posts · 2k+ votes
6y
@Abad Marroquin
Would you be able to sell at a nice gain? I think about it like this-have I realized 80% of the value add possible? If I have then I'm a lot more likely to sell. You can probably refi now if you know lenders who want to hold the note. Rates are low but liquidity is tightening up. You may need 6-12 mo of reserves and 25-30 LTV.
Investor · SC NC, VA · Member since 2020 · 1k+ posts · 756 votes
6y
If you can get a point or so then it’s worth looking into. Just have to figure out payback against the loan fees you’ll incur.
As for a 1031, the Fannie/Freddie small loan $1M to $7.5M is right now at a rate with a three in the front. 80% LTV depending on the market. That's a lot of buying power.