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Is cash-out refiance on an invest. property to pay debts a good idea?

Posted on: 22nd Sep, 2008 08:14 pm
We have an investment property. MTG is 2400/mo. Rental income = 3600/mo. Appraisal 2yrs ago was 650k. Currently owe 480k on property. 40k in unsecured debt. We would like to refinance for cash-out to pay off debts. Is this a good idea? If so, what advice for investing our money for the future? Any advice is appreciated.
Hi picture121 !

Welcome to the forums!

In cash out refinance loan, an existing loan is refinanced. Along with that a borrower is also allowed to receive cash in addition to the amount of the home loan. I think you will be able to apply for cash-out refinance loans. However you should remember that will have higher rates as compared to the refinance rate terms. You can invest in stocks, mutual funds, bonds and others.

Feel free to ask if you have further queries.

Sussane.
Posted on: 22nd Sep, 2008 08:56 pm
Picture,
You know the condition of your property. You have to be honest about what might be needed in the near future in terms of upkeep, and those costs. Also, consider the tenants; are they due a for rent increase soon? If they are, and you don't foresee any major work that needs to be done on the property anytime soon, interest rates are attractive. If the cash flow is there, go for it.
Posted on: 23rd Sep, 2008 12:38 am
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