Financing my first home investment

4 Replies

Just recently I discovered BP and it has given me motivation to start purchasing investment properties.  I have a plan, I understand the analysis needed for properties, and i'm ready to go.  However, I'm having a hard time figuring out the best route to take for financing.  My current primary residence has approximately 200k in equity so i've considered refinancing or a Heloc line of credit and using that money for purchases. However, i'd like to leave my primary residence out of the whole equation all together if possible.  Or at least find the right loan that protects my primary residence in case I buy a lemon.  I live in CA where home prices are very over inflated, thus the majority of my investments will have to be out of state.  So, my question is can financing be accomplished without leveraging my primary residence?  Is there a Heloc loan that is similar to a personal loan in that the loan is based off of credit score not collateral?  If I do use my homes equity as collateral at first can I refinance/apply for a different loan after my investment properties have gained equity, and clear my primary residence?  Any help would be appreciated.  Thank you in advance..

Curtis 

Are you looking for a long term investment or more shorter term?

Definately long term investment.  With a lot of research and a little luck I’d like to have a few dozen properties within the next ten years.

@Curtis Mooneyhan You can invest in other properties without having your primary residence at risk. If you have saved 20% Down or more all you're doing is purchasing a property with a conventional loan and securing the loan with the purchased property, there's no connection to your primary residence. If you decide to go the HELOC route I wouldn't say you're putting your primary residence at risk since you have such a large equity stake, you're simply tying the investments in a passive manner.

Thanks Ray Johnson I appreciate the information. I'm heading to the bank Monday to speak with an agent about a HELOC.

Free eBook from BiggerPockets!

Ultimate Beginner's Guide Book Cover

Join BiggerPockets and get The Ultimate Beginner's Guide to Real Estate Investing for FREE - read by more than 100,000 people - AND get exclusive real estate investing tips, tricks and techniques delivered straight to your inbox twice weekly!

  • Actionable advice for getting started,
  • Discover the 10 Most Lucrative Real Estate Niches,
  • Learn how to get started with or without money,
  • Explore Real-Life Strategies for Building Wealth,
  • And a LOT more.

Lock We hate spam just as much as you

Create Lasting Wealth Through Real Estate

Join the millions of people achieving financial freedom through the power of real estate investing

Start here