Will banks lend (HELOC) against a rental home?
Hi, I'm moving out of my house in a couple months to travel for a while. Then I will settle in a new city, and will be looking to invest in a rental property at that time. I am hoping to do this with a down payment drawn from equity on my current home (which will be a rental at that time). I have quite a lot of equity in it. My current bank that does my mortgage said they probably would not allow a heloc on my home if it is a rental, so they suggested I set it up now, before I move out.
My question is, if I wait and try to apply for a heloc later, in a 4-5 months when it is a rental, would ALL banks probably have this policy against doing a heloc on a rental? Or do you think it is just this bank? Is that a standard widespread policy? I really need to get an understanding of this because if I wait, and my current home is a rental, and I can't get a heloc for the down payment, that will derail my whole plan.
Thank you for any clarification and suggestions!