HELOC, Interest Only, Hard Money

Dustin TaylorBusiness Member

Realtor · Blue Ridge, GA · Member since 2020 · 62 posts · 22 votes

Any lenders offering HELOC's on investment properties? Are any of these options a fixed rate?

Any lenders offering interest only loans?

Any lenders offering 5% down payment for a hard money loan on the right property?

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Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
3y
I think its pretty much a no to all those questions.
on the HML if your a premier borrower of a certain HML U maybe able to get 100%
but not until you have a lot of history and completed deals with them.

HML are almost always interest only.
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Brittany MinocchiBusiness Member
Lender · Massillon, OH · Member since 2022 · 1k+ posts · 486 votes
3y
No suggestions on the HML…
I/O options depend on what you're looking for - you can find some 40 year terms with a 10 year I/O period, or a short term (12 months or so) fix and flip sort of loan that's I/O. Not enough info to give a solid answer…
There is only one fixed rate HELOC that I know of, but not all property types are eligible. Otherwise, a HELOAN may be an option - it's a closed end second (not a line of credit) with a fixed rate.
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Erin ChurchPro Member
Real Estate Agent · North Augusta, SC · Member since 2017 · 254 posts · 233 votes
3y
Quote from @Dustin Taylor:

Any lenders offering HELOC's on investment properties? Are any of these options a fixed rate?
Any lenders offering interest only loans?
Any lenders offering 5% down payment for a hard money loan on the right property?

Navy Federal used to offer HELOCS on investment properties, but not sure if they still do.
I know a hard money lender that will partner and lend 100%; they will also be an equity partner in addition to "hard money points" up front. Obviously, it's very deal specific if he's becoming a partner on it. :)
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Dustin TaylorBusiness Member
OP
Realtor · Blue Ridge, GA · Member since 2020 · 62 posts · 22 votes
3y
Quote from @Brittany Minocchi:

No suggestions on the HML…
I/O options depend on what you're looking for - you can find some 40 year terms with a 10 year I/O period, or a short term (12 months or so) fix and flip sort of loan that's I/O. Not enough info to give a solid answer…
There is only one fixed rate HELOC that I know of, but not all property types are eligible. Otherwise, a HELOAN may be an option - it's a closed end second (not a line of credit) with a fixed rate.
Im interested in how the HELOAN works. I haven't heard of this. Im assuming you can pull the equity out at what LTV is approved of the property. Then you have an interest rate that starts on that equity amount once loan is closed? How much are closing costs? Is this a fixed rate?
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Brittany MinocchiBusiness Member
Lender · Massillon, OH · Member since 2022 · 1k+ posts · 486 votes
3y
Quote from @Dustin Taylor:

Quote from @Brittany Minocchi:

No suggestions on the HML…
I/O options depend on what you're looking for - you can find some 40 year terms with a 10 year I/O period, or a short term (12 months or so) fix and flip sort of loan that's I/O. Not enough info to give a solid answer…
There is only one fixed rate HELOC that I know of, but not all property types are eligible. Otherwise, a HELOAN may be an option - it's a closed end second (not a line of credit) with a fixed rate.
Im interested in how the HELOAN works. I haven't heard of this. Im assuming you can pull the equity out at what LTV is approved of the property. Then you have an interest rate that starts on that equity amount once loan is closed? How much are closing costs? Is this a fixed rate?
It’s a closed end second, so similar to a HELOC but not a line of credit. It’s a lump sum. Rate is typically fixed and LTV depends on property type, FICO, number of units etc.
[email protected]330-354-6590
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Dustin TaylorBusiness Member
OP
Realtor · Blue Ridge, GA · Member since 2020 · 62 posts · 22 votes
3y
Quote from @Brittany Minocchi:

Quote from @Dustin Taylor:

Quote from @Brittany Minocchi:

No suggestions on the HML…
I/O options depend on what you're looking for - you can find some 40 year terms with a 10 year I/O period, or a short term (12 months or so) fix and flip sort of loan that's I/O. Not enough info to give a solid answer…
There is only one fixed rate HELOC that I know of, but not all property types are eligible. Otherwise, a HELOAN may be an option - it's a closed end second (not a line of credit) with a fixed rate.
Im interested in how the HELOAN works. I haven't heard of this. Im assuming you can pull the equity out at what LTV is approved of the property. Then you have an interest rate that starts on that equity amount once loan is closed? How much are closing costs? Is this a fixed rate?
It’s a closed end second, so similar to a HELOC but not a line of credit. It’s a lump sum. Rate is typically fixed and LTV depends on property type, FICO, number of units etc.

Would love to discuss more about this with you. I have properties I may want to use this on.
[email protected]
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Brittany MinocchiBusiness Member
Lender · Massillon, OH · Member since 2022 · 1k+ posts · 486 votes
3y
Quote from @Dustin Taylor:

Quote from @Brittany Minocchi:

Quote from @Dustin Taylor:

Quote from @Brittany Minocchi:

No suggestions on the HML…
I/O options depend on what you're looking for - you can find some 40 year terms with a 10 year I/O period, or a short term (12 months or so) fix and flip sort of loan that's I/O. Not enough info to give a solid answer…
There is only one fixed rate HELOC that I know of, but not all property types are eligible. Otherwise, a HELOAN may be an option - it's a closed end second (not a line of credit) with a fixed rate.
Im interested in how the HELOAN works. I haven't heard of this. Im assuming you can pull the equity out at what LTV is approved of the property. Then you have an interest rate that starts on that equity amount once loan is closed? How much are closing costs? Is this a fixed rate?
It’s a closed end second, so similar to a HELOC but not a line of credit. It’s a lump sum. Rate is typically fixed and LTV depends on property type, FICO, number of units etc.

Would love to discuss more about this with you. I have properties I may want to use this on.
No problem, free to connect.
[email protected]330-354-6590
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Alan Hicks
Investor · Lawrenceville, GA · Member since 2017 · 59 posts · 5 votes
3y
Also interested. I have a paid off 3/2, Valued at $225k.
Would like to tap into it without selling it.
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Dennis Muno
Lender · Denton, TX · Member since 2023 · 349 posts · 80 votes
3y
Quote from @Dustin Taylor:

Any lenders offering HELOC's on investment properties? Are any of these options a fixed rate?
Any lenders offering interest only loans?
Any lenders offering 5% down payment for a hard money loan on the right property?

Hello Dustin,
So HELOCs on investment properties are hard to come by either due to laws in some states or just the perceived risk by lenders. A home equity loan may get you some lenders who may be willing to take a loot.
Hard money loans are generally interest only during the loan during and then need to to be paid in full at the end of the loan period. Hard money would only go for properties that need some rehab or maybe for construction
For interest only loans you could do a DSCR loan to purchase an investment property, usually 1-4 units with some lenders who also offer interest only options.
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