Posted by Randy on December 07, 2004 at 10:05:12:
The state that I currently reside in is California.
using my main residence to begin - Posted by Randy
Posted by Randy on December 07, 2004 at 01:08:00:
My wife and I are trying something new. We want to do several things using our existing home as a way to enter into the Real Estate Investment adventure. The problem is what to do.
Our existing home has a loan of $137,000 at a fixed rate of 5.5%.
The house is worth around $295,000. Payments are $500 biweekly for a 30 year loan.
We would like to be able to keep our existing house and use it as a rental.
We plan on moving to another state and purchase a home at around $200,000.
Is there ways of using my existing home equity to purchase another home and maybe more purchase more investment property?
Just getting started and hoping someone can help?
Re: using my main residence to begin - Posted by Devon
Posted by Devon on December 07, 2004 at 09:46:12:
You can either get a home equity line of credit or refinance your house and pull out the equity. I would probably suggest the line of credit being that your rate is already pretty low 5.5%! Where are you (State)?
Re: using my main residence to begin - Posted by ron
Posted by ron on December 07, 2004 at 09:07:04:
I own an estate home in a state that I do not currently reside in. I do not recommend renting out your home. First, it’s too valuable. You are paying $1000 per month as well as taxes, insurance, etc… It is not as easy to rent out a nice house (worth $300k) because typically someone who can afford the rent could probably afford to buy one. If they can rent it, usually it’s a short term lease (no longer than a year). Why would they rent for longer? It’s a waste of money. Who will keep up the house? Take care of problems? Also, they are not going to take care of it the way you do. It will make it that much harder to sell when you realize that I was right.
If you are moving to another state, I would check out the investment market in the new area that you are going to live in. Target your new home and some investment property (either a single or a double). Put an offer on the house you want in the new state and on the investment property. You could make it subject to the sale of your current house (depending on your financial situation). Also, if the house you currently live in is your first home, there may be some tax advantages you should ask your accountant about (also ask about a 1031 exchange and see if it applies to you).
Good Luck