BRRRR ANALYSIS question

[Victor Avelino]

Hello

I appreciate in advance all the help.

I have a rental property in Newark NJ that I bought putting 3.5% down on FHA loan with an interest rate of 3.75

I'm thinking of doing a cash out refinance to take $50,000 so I can put that as a down payment for another property. By taking that amount of money and changing the loan to conventional as an investment property, the interest rate will go up to 5.25, bringing the mortgage payments to $500 more monthly.

Would you do something like that to put some down on another rental property or do you think it's too risky.

Thank you for your insights and God bless!