Start by preheating your oven to 325°F then liberally spray a 12-cup Bundt® pan with non-stick baking spray.
In your mixer bowl, add butter and cream cheese and beat for two minutes on high speed. Next, slowly add in sugar and oil then continue beating on high speed for an additional five minutes until it’s a very pale yellow and fluffy.
Next, add eggs, one at a time, combining well after each addition and scraping down the sides as needed.
Turn your mixer down to its lowest speed, and slowly add flour into batter in two increments then add salt. Be careful not to overbeat.
Lastly, add in vanilla extract, scrape down sides and mix until just combined and turn off mixer.
Pour 1/2 of cake batter into a separate bowl and set aside. Whisk in cocoa powder, red food coloring and hot water until completely well mixed.
Alternate dollops of vanilla and red velvet cake batter into Bundt® pan using a skewer to swirl batter.
Bake for 1 hour and 15 -20 minutes or until a toothpick inserted in the center of the cake comes out clean.
Cool in pan on a wire rack for 10 minutes, then invert cake on serving plate for at least an hour or until the cake is cool to the touch.
For the Cream Cheese Icing:
Mix cream cheese, powdered sugar, milk and vanilla extract until smooth then pour over top of cooled cake and serve.
Make sure all of your ingredients are at room temperature (especially your butter and cream cheese for both the cake and icing) before making this cake. It is essential.