HELOC and Refi on Investment Property South Jersey / Philadelphia

6 Replies

Hi All!  

I have one investment property that I refinanced over a year ago to a 15 year note.  At the time, my goal was to shorten the term of the loan.  In doing so, the property does not cash flow too well, but I do have equity in the property.  

I am looking for my next deal (ideally a BRRRR property), and would like to free up some cash for the deal. If I did a refinance with cash out on my current property, it would not cash flow any better, and would extend the loan to 30 years. Since I do not have a deal lined up quite yet, I did not want to be paying interest on the cash out, until I had the deal. I think my best option is to get HELOC on the property, so the cash is available, but not costing me anything until I find my next deal. Any recommendations for local banks in South Jersey / Philadelphia area that do HELOCs on investment property?

My second thought is to do a separate refinance (no cash out), to a 30 year loan, lowering my monthly costs and increasing my cash flow. Would a refinance restrict my ability for a HELOC?

Thanks in advance!

@Daniel Kent - I'm assuming you're looking for a commercial loan because you own the property in an LLC. If that's the case the goto in South Jersey is 1st Colonial in Haddon Township. Roy Probst is the guy you want to talk to. If residential I can't help you much...but 1st Colonial could probably still do something. If Residential you could also talk to @Joseph Scorese and see what he can help with. 

Thanks @James Masotti - I was not looking for a commercial loan because the property is not owned by an LLC. I was looking for a HELOC to help fund my next deal, but am also considering a refi to increase cash flow on that same property. I have checked with a few banks about a HELOC on my rental, but the ones I have tried so far, do not loan on investment properties. Still have more to check with but was curious if anyone had recommendations for banks that do-

Originally posted by @Daniel Kent :

Thanks James Masotti - I was not looking for a commercial loan because the property is not owned by an LLC. I was looking for a HELOC to help fund my next deal, but am also considering a refi to increase cash flow on that same property. I have checked with a few banks about a HELOC on my rental, but the ones I have tried so far, do not loan on investment properties. Still have more to check with but was curious if anyone had recommendations for banks that do-

Definitely talk to First Trust, 1st Colonial, Franklin Mint FCU, Trumark FCU...I am nearly 100% positive that all of those lenders do HELOC's on investment properties. The difference of course is on a primary you will have a lower rate and may be able to go up to 85-90% appraised value for an investment property you're going to be at a higher rate and probably max out around 70-80% appraised value.

Hi @Jibu V. -

What I have found is that lenders do not want to be the second mortgage holder on an investment property.  So the best option for Cash Out is to do a refinance with a cash out.  At this time, it does not work for me, since that option will create a negative cash flow on my property.   Maybe time to sell?  

What type of situation are you in?