Tapping into Equity

[James Moore]

Hi everyone!

I currently have two rental properties that were purchased at the end of 2024, both turnkey new construction homes.

I leveraged DSCR loan products to complete both acquisitions, along with a HELOC from a third investment property.

Between the two turnkey properties, I have about $152,000 in equity.

My question is, how do I tape into this equity using both homes, to further scale my portfolio?

Open to any recommendations from savvy lenders.

Thank you

[Patrick Roberts]

Probably not going to be able to do much with these. Very few lenders will go over 80% LTV on cashout refis, and 75% LTV is the norm. Even on a $200k property, the last $50k of equity is basically unusable unless you sell/liquidate. Maybe a blanket/portfolio loan from a specialty lender could get you $25k-$50k, but that's a stretch.

As a private lender, I would want to see at least a $50k equity buffer on most properties regardless of value to absorb price declines or foreclosure erosion for investment properties. Percentages of FMV dont mean as much on lower value properties.