Looking for the best way to borrow equity for both upgrades and future purchases.
Bought the home 5 years ago for $200,000
Currently owe $175,000 at 3.75%
Home values in the area have skyrocketed (3 neighbors in the past month have sold comparable homes for $350,000+)
A few things we are wanting to do:
1) Refinance at a better rate and to remove PMI
2) Take out some equity to do some upgrades to the home (about $40,000 - $50,000 worth) in the next 6ish months
3) Take out some equity to use as down payment on another home in the next 12-18 months (unsure on how much yet) (doing this because we want to keep this property as a rental investment, not sell it when we move)
Originally my thought was to refi at the total amount we would be needing. Now I'm investigating more on both home equity loans as well as 2nd mortgages as alternative approaches.
Long-term, what is our better play? I'm starting to think that doing a refi at the $175,000 owed for the lowest rate we can, and then taking out a home equity loan will be the best option. I'm not super keen on paying a mortgage for $X over what we have to just to hold on to money that we aren't quite ready to use yet.
Any advice?
Submitted July 04, 2021 at 09:46AM by Laezur https://ift.tt/3dDAXPW
