Question by master2303: Refinancing an investment property?
Ok I’m a little confused here. I recently purchased ( in the last 5 months) an investment property with a 2.75% 5 year variable closed mortgage. I was wondering when and in what situation it would be beneficial for me to refinance. Specifically in the situation where let’s say the property appreciates 10% in one year (hypothetical). so let’s say it I bought it at 400k and it’s now worth 440k. Should I refinance even though mortgage rates have stayed the same to take advantage of the equity build up. I know there are two different types of refinancing in this situation cash-out and equity line of credit. I’m kinda confused by the difference in the two. could you explain. Also as the property’s initial value increases does this method of taking out equity become more beneficial (i.e. if the property was worth 1 Million and went up 10% then now its worth 1.1 Million). Is it more worth it in this situation because there is a 100,000 equity build up vs 10,000. Thank you for your help. it’s much appreciated.
Best answer:
Answer by Celmira
Beneficial for me?! Thats what i’m talking about
What do you think? Answer below!