Profile picture for user4419207

Finance question - which one first refinance or loan on investment home

I am home owner and have 30% equity in the home. I am planning to refinance this home. Also, I am looking around for investment (multi-family) homes and I am ready to make an offer on one. I need standard finance ( 20% down ) on this property. Which financial transaction should I pursue first ? Refinance or Buying ? Please advise.
  • October 14 2012 - US
  • 0
    0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

Be a Good Neighbor. Be respectful and on-topic. No spam or self-promotion! See our Good Neighbor Policy.

Answers (2)

I agree. The answer here is "it depends". There is a lot to consider, including interest rates, rental values and the rental market, current market for rental properties, potential cash flow of the investment among other things. Since both offer tax benefits, you will need to be aware of the tax advantages and consequences of both.

I think you need to have a detailed side by side comparision of both scenarios to determine which makes the most financial sense over the short and long terms.

Discuss with your lender, financial professional and your tax professional to determine your best options.

Joe
  • October 14 2012
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.

I would suggest speaking with a lender about your options, we here can't know all the answers to answer that question. Debt, credit and tax returns will be needed to know the answer. What is the current rate you wish to refi? If you are going from 4.2 to 3.5% then that is one thing, but if you are going from 6.7 to 3.5% that is a big deal and I would think doing it first would be a good idea because if you purchase a new debt that makes the refi unlikely that would be worse than not having the investment right now.

Tim
  • October 14 2012
  • 0Yes

  • Report a Problem

    Please enter a valid email address.

    Content flagged

    We will review this content. Thanks for helping make the site more useful to everyone. To learn more, read Zillow's Good Neighbor Policy.

    We're sorry. This service is temporarily unavailable. Please come back later and try again.