All Forum Posts by: Jason Slater

Good advice here already, James laid it out for you. This is a good DIY project if you're looking to bank some sweat equity. Plenty of videos and articles to learn from online, do your research and be confident. Just be aware it is time consuming and you'll have a ton of dust to clean up. I've refinished nearly 1200 sqft in my units and it was tough but saved a ton of cash. Good luck!

This is all great feedback.

@John PrunierThanks for the real-world example in my neck of the woods. With upgrades and appreciation I should be over the 25% equity in the two family so doing a rental refi with SFH purchase may be a good backup option. I suppose I need to compare the cost/savings on losing the mortgage interest tax deduction vs paying PMI over the next 6 months or so. Right now even an investment loan would be under my current rate.

@Upen Patel& @Russell BrazilExcellent points,  I will be sure to have my story straight. My family will have arguably outgrown this unit by then, kids do grow fast! 

Would the alternative be that the lender asks you to refi the first loan before taking a new primary residence loan? Or would they just deny financing outright until the 12 months is up?

Thank you!

Thanks for the welcome, Michael. I just posted a question about choosing my refi which should be the first step this year on my way to converting this property to a full cash-flowing rental. :)

Hi all, I could use some help understanding the options and implications for my conventional refinance choices.

For the last six years I have owned and occupied a two unit house in Massachusetts and rent out the other unit to cover a big chunk of the mortgage. I purchased at 10% down with an FHA loan w/PMI but now surpass the 78% LTV to refinance as a conventional loan. It is definitely in my interest to do so as I will drop PMI and about 0.75% off my rate. I have saved the 20% down payment for my own SFH and plan to buy & move sometime in 2016 then rent both my current units (they will cash flow, better than $100/door). I will probably continue to occupy the two-unit for another six months this year before finding a new house and moving out.

If I refinance the two-unit mortgage in the next month or so should I just go straight to an investment property loan or should I keep it as a primary residence loan? 

Obviously there are a number of factors, such as being able to deduct mortgage interest on my primary residence which I assume I can't do if the loan is for an investment property, regardless of if I live there. I have also found through reading on BP that if I get a primary residence mortgage on it then I probably won't be able to get a new one for my next personal home within 6 or 12 months. I'd like to avoid having to refinance (fees!) the investment property again when I buy my SFH residence.

I'm looking for any advice the BP crowd may have on the best choices in this situation. I also know enough to realize I probably am missing some important consideration(s) so please let me know if that is the case. Or if I'm making a bad assumption then I'm happy to be corrected.

Thanks for your time everyone,

J in MA

Hello everyone, my name is Jason Slater and I'm a robotics engineer in the Boston area. I've always been interested in generating a small investment portfolio of rental properties near me to grow equity and hopefully not be stuck in an office for the rest of my life. Don't get me wrong, I love engineering, and Boston is a great place to do it, but I think most people here realize the value in having passive income and a Plan B!

Property prices in and around Boston went crazy up until the housing bubble burst and priced me out of the market until about 2009. At that point I was able to get a pretty good deal on a two family, 2500sqft property that needed some updating and TLC but no "major" work. So I jumped in with both feet and my plan was to fix it up, rent it out and move on to my own house within 3-5 years. Well here we are nearly 7 years later and after a little bit of Life Getting in the Way and a lot of DIY I'm finally ready to start phase two of that plan. 

Ultimately my goal is to hold this property and then try to acquire a new two to four unit every few years to add to my portfolio. There's obviously plenty of work and consideration to achieve that simple statement and I'm really thrilled to have found BiggerPockets while doing research. I have read through many of the forums and blog posts and have already found lots of actionable information. I am genuinely excited to be able to engage this kind of motivated community to help better understand the nuances of real estate investing and apply it to my goals.

Glad to be here,

Jason