Greenwell Springs, LA · Member since 2015 · 25 posts · 9 votes
What do you all think about using a line of credit for rehab costs? I just put a house under contract the other day and requires 4-5k in repairs/updates. I was originally thinking about using my own cash, but my realtor brought up the fact that maybe a line of credit would be a better option so it doesn't wipe out more of my cash after the 20% down payment for the house. I'm thinking using the line of credit and then pay it off when I refinance the home in 6 months (after the seasoning period). Any feedback on this would be great as to if this would be a good strategy or not. Thanks!
@Ryan Young Are you planning to do a conventional refinance after the 6 months? Or is this property in a LLC? 4-5k for a LOC seems a little small, not even sure someone will give that low of an amount. You might just be better off with taking out a personal loan lol. Also, a LOC might be hard to obtain if it's going to be based on the as-is value of the home and not the ARV. Doesn't seem to be an issue since it doesn't look to need major repairs. But honestly, that's a very small/petty amount to go through the process of a LOC.