Greetings all!
Long time lurker, first time poster. Until now, I had all of my financial questions answered (thanks to reading a TON on this board). This site has been a tremendous help and has really gotten me on the right path. My case study will be brief as this is purely a real estate/“what would you do?” situation.
Some general stats:
-30 something, married, 2 kids
-single income household
-approx $73k per year salary
-$98k Roth (all in S&P 500, split between IRA/401k)
-maxing 401k (finally), putting additional windfalls as they arise in IRA
-no debts
-$2k in EF (trying to minimize amount in here in order to put it to work)
-800ish credit score.
The main issue:
I currently own a home that could sell today for $155k. I bought at $145k and after my down payment, financed $129k. My mortgage has $105k remaining at 3.25% on a 15 year schedule. I have gotten a job offer and will be moving. We are looking for homes at around $210k
Do I:
-refinance current mortgage to 30 years, buy a second home and rent the current home (can rent for $1,200 a month). I would not have a down payment on home #2 unless I borrowed against my 401k.
-sell current home, use the $40k as a down payment on the next house and finance the rest of the house at 30years and invest more (max my
And my wife’s IRA)
I know the market generally comes out ahead but since I am maxing my 401K I’m looking to take the next step. Sell current home and buy new home or refinance and rent. I cannot give out too many details but I foresee my current home gaining value as the current area is up and coming. What say you? If more info is needed please let me know! Thanks, this was all typed out in my phone so the format may be wonky (8 year old laptop is acting up!)