Let’s just use round numbers for simplicity purposes, my house is worth $800k and I owe $400k. I am thinking about doing a cash out refi to pull out $240k to have a loan to value ratio of 80%. I then want to take this money and invest it in an existing well diversified portfolio including stocks, commodities, real estate, etc. where I already have around $300k invested. I recognize this will cause my monthly mortgage payment to increase, but I would plan to offset this by investing less each month. The way I am looking at this is that the equity in my home is a nice to have, but the money isn’t working for me. My wife and I plan to send all of our children to school while we live here (17 more years) so I am not overly concerned if my house loses value short term. I feel like this is an opportunity that isn’t always available and I should capitalize on it while it last. Interest rates are low and the housing market is up, making this feasible right now. I do understand there is risks in doing this, but I am in the housing market and the stock market for the long haul, not looking to get rich over night and am prepared to weather the storm.
Submitted November 14, 2021 at 11:30AM by johnnyxj26 https://ift.tt/3kAGz14
