Newbie Seeking Advice

[Anthony David Quinn]

Hello BP, I am looking for some help. 

I own one single family which is my primary residence. The property has a value of approx $300K (neighbour just sold for 300K) mortgage of around $120K. Im thinking of either selling the property and using the money to fund live in flips and build up capital that way. Or use a HELOC to access the equity, rent out current home and then use the HELOC plus some other funds (about 20K) to try and BRRRR. What do we think is best approach? Also, where do people find good BRRRR properties. Everything I find on Zillow is too expensive to make work.

Thanks

Anthony 

[Samuel Eddinger]

I've been an advocate of using HELOC to fund my investment portfolio for over ten years. It was the single best decision I ever made. I started back in 2009. In my scenario, I used the money from my HELOC to either buy in cash or finance properties that were close enough to turnkey that I would not be able to get significant additional equity out.

I'd then renovate them, and refinance them and pay down the HELOC. I'd also throw every extra dollar of cash I had to pay them down so that I could buy more. I'm now at over 20 properties and 50 residential units.

The concern on HELOC is that with it being tied to the prime rate, it can vary as the FED continues to raise interest rates. While you will get a teaser rate for one year, my rate is now at something like 8.5% which could cause significant issues for some people (I've been aggressively paying it down).

If you legitimately only use it for real estate purchases and pay it down whenever possible aggressively, it is a great option!  Happy to talk more about this if you want to DM me.