Using my house hack as leverage for next deal how to

[Nick Mazziotti]

Looking house hack a 80k duplex (with FHA loan) and putting 20k into the rehab. Assuming it appraises for 120k + ARV, how can i leverage my equity in this duplex into another deal ?

Can I use a HELOC as a down payment for another deal ? Cash Out refinance ? Do you guys recommend any other way to use the duplex as leverage to purchase another investment property after. Don't want to corner myself

Any feedback is helpful thank you !

[Nathan Gesner]

Quote from @Nick Mazziotti:

A HELOC is nice because you don't pay interest until you borrow against it and it can be used over and over again. However, it's just another way of borrowing money with a higher interest rate, not unlike a credit card. I don't recommend it.

Your plan won't work because there's not enough meat on the bone. You need an ARV high enough that you can pull 80% back out and have more than you started with.

Most investors doing the BRRRR method will pay cash for the house, cash for renovations, then refinance with a lender and pull their cash back out plus some extra. In your case, you would probably pull out less than you put in.