Just starting out in real estate Investing, Should I use HELOC?

[Angel Nieves]

Hello my fellow investors,

Let me tell you a little about myself before I ask my question. I live in the Phoenix area and I am 35 years old and I just starting looking into real estate investing. I am a complete newbie and eager to make it. I already have a home that is estimated at around $550k. I still have a balance of $360k. I already applied for 2 LLCs (Arizona and Florida) so I can put my rentals under the LLC in order to protect my personal belongings. My question is, If I were to buy property using HELOC, Would that tie my personal house to my LLC. Meaning: If I were to get sued, since I used my personal house to get credit, would my house be up for grabs.

That was my whole reason for creating the LLC. So if it is up for grabs, I guess I will have to get financed another way.

Any advice will be greatly appreciated. Thank you.

[Pamela Sandberg]

Your personal residence would be protected by the LLC. If you were sued, ONLY the LLC assets would be "up for grabs". So as long as your personal residence stays in your personal name, it doesn't matter if there is a HELOC on it, or if that was the source of funds for the LLC.

Happy to answer any other questions about this or the Phoenix market!