Just inherited property with Refi Owed

[Kenneth McDonald]

I am in a dire situation, I inherited property from a parent with a high refi balance. The property has great potential and space to expand, I really need advice if I want to fix and keep or take addition equity and expand

Please help

Thank You

[Denise Supplee]

Hi @Kenneth McDonald, nice to meet you here on BP. That’s a big opportunity but I hear the pressure too. A good first step is to get clarity on numbers before deciding whether to fix and keep or expand. I’d recommend getting a contractor (or even two) to walk the property and give you ballpark estimates for both a basic rehab and for adding ADUs/expansions. At the same time, run rental comps in the area for each scenario..single family, single family + ADUs, etc.to see how much extra income each option could generate. From there, compare the added value and rental income against the cost of construction and your financing options. Sometimes the smartest play is to phase improvements rehab first to stabilize cash flow, then build ADUs later once you’ve got more breathing room.